Marlowe is a ‘clear opportunity’, says Berenberg
Security systems provider Marlowe (MRL) has hit its lowest-ever valuation and represents a ‘clear opportunity’, says Berenberg.
Analyst Calum Battersby retained his ‘buy’ recommendation and target price of £11.60 on the stock, which closed up 1.5% at 680p on Tuesday.
The shares are down around 35% year-to-date, ‘taking the company to its lowest valuation as a listed entity – of just 13.7x price/earnings’.
‘This has come despite no underlying downgrades from the company, the fact that 85% of revenues are recurring (the majority of which are supported by regulatory demand drivers), that the last update from Marlowe stated that it had started the year with “high-single-digits” organic growth, and that the company has continued to state confidence in its ability to pass on cost inflation in higher prices to clients,’ said Battersby.
He said, therefore, that the valuation ‘represents a clear opportunity for investors, and one that should be realised’.