Begbies Traynor shares rise on strong results

Investing.com — Shares of Begbies Traynor Group (LON:) rose over 4% on Tuesday, following its half-year results and a revised outlook from analysts. 

The company reported a 16% year-on-year increase in revenue, reaching £76.3 million, supported by 11% organic growth and contributions from recent deals.

 Adjusted pre-tax profit rose by 16% to £11.5 million, maintaining a healthy margin of 15.1%. Earnings per share improved by over 12%, highlighting a strong operational performance across both its business recovery and property advisory segments.

Analysts at CG Capital Markets have responded positively to these results, citing the company’s solid balance sheet and its ability to capitalize on a supportive macroeconomic environment. 

The analysts pointed to Begbies Traynor’s ability to maintain growth momentum while navigating higher operational costs tied to strategic investments in talent acquisition. 

They noted that these investments are aimed at sustaining long-term growth and market share expansion.

The company reaffirmed its confidence in meeting full-year market expectations, projecting adjusted pre-tax profit in the range of £23.0 million to £24.3 million. 

Furthermore, the company is reportedly on track to achieve its mid-term revenue target of £200 million. 

The optimistic outlook is further underpinned by the company’s capacity for future acquisitions, supported by ample financial headroom.

CG Capital Markets increased its target price for Begbies Traynor to 150p, up from 148p, representing a 59% implied upside from current levels. 

The analysts flagged the stock’s valuation at a slight premium to its historical averages, which they believe is justified by its strong positioning and the potential for additional bolt-on acquisitions.