RBC Capital lifts price target on Auction Technology

(Sharecast News) - RBC Capital Markets lifted its price target on Auction Technology on Thursday as it upgraded its model to reflect cost-savings driven upgrades.

The bank, which hiked the price target to 400p from 310p, said it was encouraged to hear new chief executive Duncan Painter acknowledge previous issues and return the focus to the core business of selling items in the first-half results.

RBC noted Painter's comments about how the group had focused too much on valued added services and not on the core auction business.

"We believe this change in tone is an important step in rebuilding credibility with the market and reinvigorating the core," it said. "We also understand that the COO has departed the business and Duncan is now in control of both sales and operations and has made it a mission to get closer to the client base."

RBC continued: "After digging deeper though at A&A, we are unclear if the narrative matches the data and at I&C we question whether rectifying market share losses is a quick process.

"We update our model, reflecting the cost-savings driven upgrades for FY26 and beyond, with our revised price target of 400p underpinned by FitzWalter's recent attempts to acquire the company."

RBC reiterated its 'sector perform' rating on the shares.

FitzWalter Capital made 12 takeover approaches to Auction Technology, the last one at 400p per share. All of them were rejected and the investment firm announced in February that it was abandoning its pursuit of the online auction operator.

At 1338 BST, the shares were up 0.5% at 403.80p.