Broker tips: Genuit, Softcat, AutoTrader, British Land, Land Securities

26th May 2026 13:07

(Sharecast News) - Deutsche Bank has slashed its target price for plastic piping systems Genuit by nearly 20% amid a "challenging environment" for the plastic piping manufacturer, but said that self-help measures have mitigated downside risk to forecasts.

The bank lowered its target for the shares from 545p to 440p but maintained a 'buy' rating following Genuit's trading update on 22 May.

Genuit said a subdued UK housing market and cost inflation driven by the conflict in the Middle East is having an impact on the bottom line, highlighting a lag with its own price increases along with lower volumes.

"Genuit points to a challenging environment, with lower market volumes and significant polymer cost inflation. Assuming a timely stabilisation in macro conditions, management is guiding to FY26 EBIT towards the lower end of the consensus range (c.£95m-106m)," said Deutsche Bank.

Deutsche Bank said was taking a "slightly more cautious view", cutting its FY26 EBIT forecast by 13% to around £91 and outer year forecasts by a more modest 8%, as Genuit benefits from £4 to £5m of targeted cost savings.

"Post these moves, Genuit trades on a 2026 P/E ratio of c.12x (historical average: c.14x) and dividend yield of c.5%. Taking a medium-term view, we believe the group is well-placed to outperform its markets and drive margin expansion, supported by exposure to structural drivers, self-help, and M&A," DB said.

Analysts at Berenberg raised their target price on software firm Softcat from 1,900p to 1,950p on Tuesday, following the group's third quarter trading update last week.

Berenberg said Softcat had delivered "strong double-digit year-on-year growth" in both gross profits and underlying operating profits in Q3, something it said was "particularly impressive" given its "excellent H225 performance", in which the company delivered gross profit growth of 24% and underlying operating profit growth of 22%.

The German bank noted that Softcat had also upgraded its FY26 underlying operating profit guidance to "mid-teens year-on-year growth", up from the high-single-digit growth guided to in its interim results, which itself was an upgrade from the firm's initial low-single-digit guidance.

"While the share price has increased by c40% since Softcat's H126 results in March, we think 19.3x FY26 P/E (ex-cash) looks cheap relative to our expectation of an 11% FY25-28 EPS CAGR, cash conversion of at least 90% and a strong track record of beating even its upgraded guidance," said Berenberg, which reiterated its 'buy' rating on the stock.

"We upgrade our forecasts for gross profit by 4% in each of FY26, FY27 and FY28, and for underlying operating profit by 6% in each of FY26, FY27 and FY28. This brings our FY26 underlying operating profit forecast in line with the upgraded guidance."

Berenberg added that Softcat has "a strong record of beating even its upgraded guidance", as was the case in FY25.

Berenberg also cut its target price for new and used car sales platform company AutoTrader, saying that the stock was cheap but lacking any near-term catalysts to take the shares higher.

Berenberg kept its 'hold' rating on the stock, lowering its target from 580p to 510p.

The broker said it cut profits forecasts by around 4% after FY26 results from AutoTrader came in below expectations last week, driven by lower assumptions on stock and forecourt numbers, putting its numbers at the low end of the company's guidance range.

Issues with the rollout of AutoTrader's Deal Builder platform, designed to improve buyer intelligence and help retailers convert more deals, resulted in higher-than-normal churn in the company's dealer base, with retailer numbers falling by 4% in the second half ended 31 March. While the company has noted recent improvements in retail numbers, it guided to a further 1-2% decline in the dealer base in FY27.

Meanwhile, average revenue per retailer for FY26 was also below forecasts, partly due to retailers withholding a greater proportion of stock on the platform, Berenberg said.

"While the company's £300m incremental buyback being above our prior forecast and its valuation are supportive, improving dealer profitability and a recovery in forecourts are more important for sentiment, and we do not see any near-term catalysts for a re-rating," it said.

Panmure Liberum downgraded AutoTrader to 'hold' from 'buy' and slashed its price target on the stock to 420p from 830p.

Panmure said the aftermath of the "disastrous" Deal Builder rollout has been worse than it expected and now forecasts underlying top-line growth of 1% in FY27, plus second half-weighted EBIT growth of 1.2%.

It noted that Autotrader bought back around £270m in stock in the second half and has committed to another £500m buyback in FY27, but said earnings per share accretion is offset by higher net finance costs, which led Panmure to trim its FY27 EPS forecast by 3% and upgrade its FY28 estimate by 2%.

"Autotrader is still a good business, capable of delivering mid-single-digit top-line growth in the medium term," said Panmure. "However, guidance presumes recovery in paying retailer customers, and the end-market remains weak."

It said the Deal Builder product was planned to be a core growth driver, but it looks unlikely that it will contribute materially in the next few years, and in its absence the broker is left questioning what Autotrader's next growth driver will be. Panmure added that its new target price was based on a 10% free cash flow yield for a stock with 1% underlying growth.

Barclays upgraded British Land to 'overweight' from 'equalweight' on Tuesday and reiterated its 'overweight' rating on Land Securities as it argued that both now offer what investors increasingly want from listed real estate.

The bank said that following three years of broadly flat earnings, British Land was now returning to earnings growth and it thinks the valuation screens attractively given increased earnings growth visibility.

"BLND has spent much of the past decade being judged on NAV, ERV growth and valuation yields, but the market increasingly cares about recurring earnings, EPS CAGR and cash flow delivery," it said. "The company has shown a strong operational performance, clear leasing momentum, in particular from AI and technology tenants, and we think it offers the right product in an increasingly bifurcated London office market."

"Following the shares' underperformance year-to-date, we think the valuation is attractive both versus its own history and in isolation," it said. "This is not an NAV story; it is an income and income-growth story, and we think British Land's high-quality office portfolio and well-performing retail park portfolio will lead to continued operational strength."

Barclays lifted its price target on British Land to 465p from 450p.

It also upped its price target on Landsec to 780p from 770p. It said the company offers investors a decent London office portfolio and strong retail exposure on attractive income yields, with visible rental growth, development lease-up and capital discipline driving the EPS CAGR.

"That is precisely what listed real estate should offer, in our view," Barclays said.