Halma, Diploma and Bunzl Shares – New Analyst Coverage (HLMA, DPLM, BNZL)

Kepler Cheuvreux has initiated coverage on three UK-listed industrial firms, taking a bullish view on Halma (LON: HLMA) and Diploma (LON: DPLM) while adopting a more cautious stance on Bunzl.

Halma was rated Buy with a price target of 3,410p. Kepler Cheuvreux said Halma’s “structurally strong market position, pricing resiliency, and consistently strong profitability” supported the rating. 

The firm added that Halma benefits from operating in regulation-heavy and niche end-markets, which create high barriers to entry and customer loyalty. 

With operating margins above 20% and a capital-light, high-return business model, Kepler Cheuvreux says the company’s “strong balance sheet and robust M&A pipeline” could result in an EPS compound annual growth rate of 11.7%, “well above consensus.”

Diploma was also initiated with a Buy rating and a price target of 5,350p. Kepler told investors that the company has “robust” pricing power, which should enhance its market position, while also noting its “best-in-class” profitability.

In contrast, Bunzl was rated Hold with a 2,230p target. The analysts flagged risks to visibility stemming from recent operational issues and potential external pressures. 

They said Bunzl’s Q1 2025 update “made investors cautious about operational execution issues,” adding that tariff risks and “broad-based cost inflation” may pressure margins. 

The firm also warned that exposure to “more commoditised markets” limits Bunzl’s pricing flexibility, creating a “challenging near-term outlook.”

While Halma and Diploma were highlighted for their quality, Kepler noted that macroeconomic uncertainty clouds the path forward for Bunzl.