Jefferies analyst Andrew Douglas maintained a Buy rating on Severfield (SFR – Research Report) today and set a price target of p41.00.
Andrew Douglas’s rating is based on several key factors that highlight Severfield’s strong position despite a challenging market environment. The company’s recent Pre-Close Trading Update indicates that its profit before tax for the fiscal year 2025 is expected to align with management’s previous guidance, suggesting stability in its financial performance. Additionally, Severfield’s order books have shown significant improvement since February, and management’s expectations for fiscal year 2026 remain unchanged, which reflects confidence in the company’s future prospects.
Furthermore, Severfield has effectively managed its cost base and net debt, with the latter being slightly better than expected. The ongoing bridge remedial works are progressing as planned, with costs remaining within the anticipated range. Despite the mixed outlook for the UK market, Severfield’s shares are considered undervalued, and the company is seen as well-positioned to navigate near-term challenges while capitalizing on future opportunities. These factors collectively underpin Andrew Douglas’s decision to reiterate a Buy rating for Severfield.