GUD’s sales and underlying earnings results fell short of the broker’s forecasts, while a number of one-offs led to a messy profit number. It was a familiar story of Auto performing well and Dexion posting another loss.
Oates and Davey also had tough halves as GUD’s consumer divisions continue to hold back Auto success. The good news is these divisions now represent a lower proportion of revenues. Auto remains the focus, and a divestment of Dexion would free up capital to pursue growth in this space, the broker notes.
Neutral retained. Target rises to $10.15 from $9.73.
Sector: Consumer Durables & Apparel.
Target price is $10.15.Current Price is $10.08. Difference: $0.07 – (brackets indicate current price is over target). If GUD meets the UBS target it will return approximately 1% (excluding dividends, fees and charges – negative figures indicate an expected loss).