Galliford Try shares jump 8% as brokers lift forecasts after profit beat

Shares in Galliford Try Holdings PLC (LSE:GFRD, FRA:3WC) climbed 8% to 548p on Wednesday after Peel Hunt and Panmure Liberum both raised their earnings forecasts for the construction group in response to a strong full-year trading update.

The company said that revenue for the year to 30 June would rise around 3% and that adjusted pre-tax profit would land at the top end of a consensus range of £51.4 million to £53.4 million.

Panmure lifted its price target to 690p from 650p and kept its 'buy' rating, citing margin progress.

The broker increased its earnings per share estimates for the 2027 and 2028 financial years by 10% to 11%, while holding its already high forecast for 2026.

Peel reiterated its 'buy' rating and 650p price target, raising its earnings estimates for the 2026, 2027 and 2028 financial years by 2%, 9% and 9% respectively, to 38.5p, 42.3p and 47.2p.

That implies earnings per share growth of more than 20% for the year just ended, Peel Hunt said.

Both brokers seized on the cash performance.

Panmure raised its estimate for average net cash over the year to £216 million from £192 million, pointing to strong collections.

Peel had assumed £170 million at the start of the year, against the £216 million the company now expects.

Its order book has grown to £4.3 billion from £4.1 billion, providing roughly 90% cover for revenue in the current financial year.

Panmure said scenario analysis pointed to a range of 52p to 69p for fully diluted earnings per share by the 2030 financial year, triple the 2023 figure

It said growth in the Building division during the second half had been held back by slow government decision-making, but expects strength in custodial work and building momentum in affordable housing.

In Infrastructure, it described water as a particularly exciting market and highways as strong for the group.

Peel said the company's 2030 targets, which include a 4% margin, were firmly in sight, and that the shares offered excellent value.

On Peel's upgraded June 2027 estimate, the shares trade on 11.8 times earnings, while Panmure put the calendar 2027 multiple at 11.1 times, which it called cheap given the growth potential.

Galliford ended the year with cash of £258.8 million and holds a portfolio of marketable Public Private Partnership assets worth about £37.2 million.

The group has no bank debt and no pension liabilities.

Recent contract wins include the £15.4 billion Department for Education Construction Framework 25 and a £750 million affordable homes framework for Sovereign Network Group.

Galliford builds schools, hospitals and water infrastructure, working predominantly through public sector and regulated frameworks