Recent sell-off in Spirax-Sarco shares "overdone", says JP Morgan

8th Sep 2023 07:48

(Sharecast News) - JP Morgan has lifted its target price for Spirax-Sarco, saying that the engineering group's recent share-price weakness has been unwarranted.

The bank upped its target price for the shares from 11,300p to 11,500p and maintained an 'overweight' position on the stock.

Since the company reported its interim results on 10 August, the stock has fallen 9% on investor concerns that guidance for the full year remains too high.

"We conclude that investor caution is overdone and risk/reward is skewed to the upside," said analyst Lushanthan Mahendrarajah in a research note on Friday.

"Spirax-Sarco is a world-leading thermal energy management and niche pumping group, comprising three specialist engineering businesses. The group is well placed to help its diverse customer base improve their production efficiency, meet their environmental sustainability targets and improve the quality of their products."

The shares were up 1.6% at 10,035p on Friday morning.