Breedon Price Target Cut, Analyst Remains Bullish On Shares (LON:BREE)

Breedon Group shares (LON:BREE) closed at 382 GBp, reflecting a 2.15% dip on the day, and continuing what has been a difficult start to 2025, with the price down 13.77% on the period. In hitting an intraday low of 377p, Breedon's share price came awfully close to 52 week lows of 366.50p.

A price target cut on the day actually offers a bullish take on BREE, with the outlook remaining positive, and the upside considerable to the revised mark.

Barclays' made the decision to lower its price target on Breedon from 584 GBp to 531 GBp, while maintaining an “Overweight” rating, encapsulates the nuanced outlook surrounding the stock. This adjustment reflects a recalibration of valuation expectations in light of broader market conditions and recent performance.

Breedon's recent financial performance and strategic decisions offer a clearer picture of the company's underlying strengths and future prospects. The company's robust fiscal year 2024 results, released on March 5, 2025, showcased a 6% increase in revenue to £1.58 billion and an 11% rise in underlying EBITDA to £269.9 million.

The highlight of the year was the $238 million acquisition of Lionmark, a Missouri-based company, a move expected to more than double Breedon's U.S. revenue and be immediately earnings-enhancing. This strategic expansion into the U.S. market has been largely viewed favourably, with the company shares surging 13% following the announcement.

The analyst community remains cautiously optimistic, and Barclays are not alone in updating their price targets and ratings following the financial results and U.S. acquisition.

Berenberg Bank raised its price target from 540 GBp to 590 GBp, reaffirming a “Buy” rating, signaling confidence in Breedon's growth potential. Royal Bank of Canada, while maintaining an “Outperform” rating, adjusted its price target downward from 650 GBp to 625 GBp, reflecting a slightly more conservative outlook. These adjustments highlight the ongoing debate among analysts regarding Breedon's fair valuation in the current market environment.

The consensus price target of 531p is in line with Barclays' expectations, and signals that the analyst community continue to see considerable upside from current levels. Despite the view from the street, the Breedon share price remains an underperformer over various time-frames, with a 20% downside delta to the FTSE 100 since the start of this year, and delivering less than 1/3rd of the blue-chip index's gain over the past five years. Time will tell if the company can reverse the trend and flip into an outperformer in the weeks and months ahead.