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Cape upgraded by Macquarie

24 August 2016 13:26

Equity research analysts at Macquarie have upgraded their investment rating on Cape (LON:CIU) to 'neutral' following the latest set of interim results from the mid-cap industrial services company.

The broker said: "Margin pressure, our primary thesis at initiation back in Sept 2015, certainly played out in 1H results and operating profit came in 19% below our forecasts. However, cashflow generation and net debt were much better.

"It is clear from the top-line growth that Cape is increasingly able to cross-sell. However, we believe that there is more that can be done, especially the Specialist Services (industrial cleaning, heat exchanger refurbishment, storage tanks) in the Middle East."

Analysts have raised their target price slightly to 180 pence a share.

Meanwhile, JP Morgan Cazenove stuck with its 'neutral' call and said: "Overall, we think 1H16 results are weak but market expectations were quite low and hence we think Cape might trade broadly inline with the sector today."

At 1:26pm: (LON:CIU) Cape PLC share price was +10.88p at 197.88p

Story provided by StockMarketWire.com

Related Company: CIU

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