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Prices & Quotes - UK Markets - Synthomer (SYNT)

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Share Price:
Up 529.50p
Change Today:
2.50p
Market Cap:
2,249.59m
Sector:
Chemicals

Peel Hunt lowers target price on Synthomer ahead of OMNOVA acquisition

By Iain Gilbert

Date: Monday 16 Sep 2019

LONDON (ShareCast) - (Sharecast News) - Analysts at Peel Hunt trimmed their target price for shares of British chemicals firm Synthomer from 450p to 435p on Monday, noting that opportunities stemming from its proposed acquisition of OMNOVA Solutions should offset weak European demand.
Peel Hunt said there were no signs of a pick-up in European industrial activity in the third quarter and, as a result, felt it was "prudent" to trim its full-year forecasts on the firm.

However, while Peel Hunt expected that trading for Synthomer's European-focused Styrene Butadiene Rubber (SBR) unit would remain "challenging" in the second half of the year, it felt that the synergies from the purchase of OMNOVA and an eventual recovery in European demand would drive a re-rating in the shares.

The broker also updated its model for the group's recent rights issue.

"We have reduced our FY19 and FY20 PBT forecasts for Synthomer, ex-OMNOVA, by 5% & 3% respectively, to 135m (30.5p) and 150m, but have now adjusted our model for the recent 204m rights issue and are assuming a full-year contribution from OMNOVA in 2020," said analyst Dominic Convey.

Including OMNOVA, Peel Hunt now forecasts full-year 2020 pre-tax profits of 178m but also expects the transaction to increase group net debt towards 700m at the end of 2019, to approximately 2.8 times underlying earnings on a pro forma basis.

"We expect progress on the OMNOVA synergies, steady de-leveraging of the balance sheet and ultimately an improving outlook for European industrial demand to drive a justified re-rating," concluded Convey, who stood by his 'buy' recommendation on Synthomer.

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Synthomer Market Data

Currency UK Pounds
Price 529.50p
Change Today 2.50p
52 Week High 552.00p
52 Week Low 287.80p
Volume 853,448
Shares Issued 424.85m
Market Cap 2,249.59m

Performance Indicators

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What The Brokers Say

Strong Buy 10
Buy 0
Neutral 4
Sell 0
Strong Sell 0
Total 14
buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

Synthomer Dividends

  Latest Previous
  Final Interim
Ex-Div 03-Jun-21 22-Oct-20
Paid 05-Jul-21 10-Nov-20
Amount 8.60p 3.00p

Trades for 30-Jul-2021

Time Volume / Share Price
16:35 132,032 @ 529.50p
16:29 4 @ 526.50p
16:29 152 @ 526.50p
16:29 149 @ 526.50p
16:29 123 @ 526.50p

Synthomer Key Personnel

CEO Calum MacLean
CFO Steve Bennett