Broker snap: Howden a 'sell' despite beating forecasts, says Panmure Gordon

28th Feb 2013 10:24

Kitchens and joinery products group Howden saw shares surge on Thursday morning after beating forecasts with its 2012 results; however Panmure Gordon has retained its 'sell' rating for the stock after a strong recent performance."These are strong full-year results from Howden with pre-tax profit above consensus expectations, a healthy net cash position and dividend increase easily exceeding forecasts," said analyst Andy Brown.Adjusted pre-tax profit edged higher from £111m to £112m in 2012, ahead of forecasts, but Panmure expects a flat performance this year (£112), below current consensus forecasts (£118.3m).Brown said: "Against a backdrop of increasing uncertainty on big ticket consumer spend we have a cautious recommendation after a strong move up in the share price."Including Thursday's 9.03% rise, the stock has jumped 76% over the past year, having risen around 20% in 2013 alone."The group still has opportunity to expand its branch network and these take a number of years to mature which provides some visibility ahead for it."The broker said that the shares are trading at 13.9 times 2013 estimate earnings, well ahead of the five-year average multiple of just 8.4.BC