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(Sharecast News) - Deutsche Bank initiated coverage of interdealer broker TP Icap at 'buy' with a 415p price target on Monday as it said it was "more than a cyclical broker".
The bank said that trading on circa 9x FY26 and 8x FY27 consensus price-to-earnings, TP Icap remains valued like a structurally challenged broker.
"We think that misses the point," DB said. "The group remains broker-led, but our analysis suggests electronification is supporting productivity rather than simply displacing the franchise.
"Our buy case does not require TP Icap to become a scaled electronic trading platform or a pure data analytics provider."
Deutsche said the market appears to be applying one broker multiple to a more resilient earnings mix.
"Global Broking is still cyclical but more productive, E&C has low-bar margin-repair potential, Liquidnet adds agency execution and buy-side workflow, and Parameta is a higher-margin subscription-led data asset," the bank said.
At 0946 BST, the shares were 1.5% higher at 320.80p.
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