Boral’s sale of its US fly ash business for A$1bn is a positive development, Macquarie suggests, even though the broker valued the business at A$1.5bn, as it focuses the company on its domestic cement, aggregate and concrete market.
The broker continues to like the Boral thesis, given a strengthening infrastructure demand environment and signs of recovery in the multiresidential market, combined with the credible opportunity to improve profitability via the group’s Transformation Plan.
Outperform retained, target falls to $7.20 from $7.50.
Sector: Materials.
Target price is $7.20.Current Price is $6.27. Difference: $0.93 – (brackets indicate current price is over target). If BLD meets the Macquarie target it will return approximately 13% (excluding dividends, fees and charges – negative figures indicate an expected loss).
