GUD – Credit Suisse rates the stock as Neutral

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GUD Holdings’ (unscheduled) trading update for the first quarter shows automotive sales up 16% despite the headwinds from Victoria and New Zealand. Credit Suisse observes this reflects strong end markets and restocking by key customers.

Davey sales were up 10% due to buoyant domestic markets which more than offset offshore headwinds. The update beats Credit Suisse’s previous forecasts and leads the broker to upgrade its auto sales assumption to 11% in the first half.

The second half auto-growth is pegged at 8%.

Neutral rating is retained. Target rises to $13 from $11.80.

Sector: Consumer Durables & Apparel.

Target price is $13.00.Current Price is $12.61. Difference: $0.39 – (brackets indicate current price is over target). If GUD meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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