GUD Holdings’ (unscheduled) trading update for the first quarter shows automotive sales up 16% despite the headwinds from Victoria and New Zealand. Credit Suisse observes this reflects strong end markets and restocking by key customers.
Davey sales were up 10% due to buoyant domestic markets which more than offset offshore headwinds. The update beats Credit Suisse’s previous forecasts and leads the broker to upgrade its auto sales assumption to 11% in the first half.
The second half auto-growth is pegged at 8%.
Neutral rating is retained. Target rises to $13 from $11.80.
Sector: Consumer Durables & Apparel.
Target price is $13.00.Current Price is $12.61. Difference: $0.39 – (brackets indicate current price is over target). If GUD meets the Credit Suisse target it will return approximately 3% (excluding dividends, fees and charges – negative figures indicate an expected loss).