A recent survey of investors found margins are considered to be either the most or second most important driver of Brambles’ share price by 84% of respondents. The broker notes pallet rental prices are rising, new pallet prices have increased, timber and transport costs are now falling having risen 35% last year, and new contract wins suggest volume momentum.
As a result the broker has increased its margin assumptions and its target to $13.30 from $12.10. Buy retained.
Sector: Commercial & Professional Services.
Target price is $13.30.Current Price is $11.98. Difference: $1.32 – (brackets indicate current price is over target). If BXB meets the UBS target it will return approximately 10% (excluding dividends, fees and charges – negative figures indicate an expected loss).