Cavendish has responded positively to Hardide Plc’s (LON:HDD) strong third-quarter trading update, raising its FY26 earnings forecast and target price.
The broker expects FY26 revenue of £13.5 million, adjusted EBITDA of £5.5 million and adjusted pre-tax profit of £4.6 million. Its adjusted EPS forecast has been increased by 33% from 4.0p to 5.4p, mainly because input costs have risen by less than expected, lifting the forecast gross margin from 53% to almost 62%.
Cavendish has also introduced FY27 forecasts, including revenue growth of 39% to £18.8 million, adjusted EBITDA of £8.0 million and EPS of 7.7p. The broker believes Hardide’s investment in three new coating reactors should support its ambition to double revenue again within two to three years.
David Buxton, Director of Research said:
“This target price offers considerable upside to current levels and underlines the enhanced medium-term growth trajectory and strong investment case. As such, we reiterate our enthusiastic Buy rating.”
As a result, Cavendish has raised its target price from 60p to 115p and reiterated its Buy recommendation. At the 74.5p share price used in the note, the new target represents potential upside of 54%.
Hardide Plc develops and applies advanced tungsten carbide-based coatings that protect critical metal components from wear, erosion and corrosion, helping customers extend equipment life and improve performance across sectors including energy, aerospace, manufacturing and semiconductors.
