Jefferies starts Halma at 'buy'

30th Jun 2015 14:27

Jefferies initiated coverage of Halma at 'buy' with an 880p price target.It said the core attractions are sector-leading returns, strong market shares in niches with clear long-term structural drivers and an innovative business model."The many subsidiaries, for some, make it a more difficult business to evaluate, but we believe this misses the clarity of purpose and business themes that conspire to create value," the broker explained.Jefferies said Halma has an impressive financial record, consistently delivering growing profits, high returns and strong cashflows with low levels of balance sheet gearing."It has a 36-year history of growing dividend payments by at least 5% per annum, demonstrating the success of its model," remarked the brokerage.Jefferies reckons Halma should be a core long-term holding within the UK industrials space."We view the stock as a 'long-term compounder' and see the recent lacklustre share performance as an opportunity," it added.At 14:32, shares were up 0.3% at 766p.