Travis Perkins worth a premium says Barclays
Published: 30 June, 2009
LONDON: Investment advisers, Barclays Wealth, think Travis Perkins' shares worth a premium.
Andrew Miller at Barclays Wealth said: "The price is justified by the group's strong management team, its leading position in both the DIY and building merchants markets, its superior margins and consequently its ability to discourage price competition."
"In our view, Travis Perkins has been the most proactive in its cost-cutting initiatives relative to rivals,' he said.
He said that Travis Perkins derives 85% of revenues from residential markets and although the group lacks diversity compared to peers Wolseley and SIG, "we think there is a good possibility that UK residential housing will recover ahead of both the US, Europe and almost certainly before non-residential."