Analyst Cautious on Chesnara Share Price as Forecast Clarity ‘Inherently Challenging’

Barclays initiated coverage of Chesnara (LON: CSN) with an Equal Weight rating and a 300p price target this week, highlighting uncertainty around forecasting for the life and pensions consolidator.

Chesnara, known for its “20-year track record of acquisitive growth,” is expected to see share price movement linked to the timing and announcement of new acquisitions, Barclays said in a note to clients.

However, the bank cautioned that forecast clarity is “inherently challenging with acquisitive growth models, and Chesnara is no exception.”

While Chesnara’s business model centres on growth through acquisitions, Barclays noted that deal potential is difficult to price in until deals are announced, making it challenging to model earnings or assign a more bullish rating until greater visibility emerges.

Barclays’ 300p price target is below the broader analyst consensus of 337p, which implies about 12% upside from current levels, according to TradingView. Of the four analysts covering the stock, three rate it a Buy and one rates it a Hold.

The Equal Weight rating from Barclays reflects a more cautious stance compared to peers, despite Chesnara’s solid track record of executing deals. 

So far this year, the stock is up around 12.9%, with a 20.7% gain in the last 12 months. It currently trades around the 301.5p mark.