Reckitt Benckiser share price: AJ Bell weighs in on group after results

Tsveta van Son
  • February 19th 2019, 08:16
  • Last Updated: October 21st 2019, 15:13

AJ Bell reckons that a potential sale of spin-off of Reckitt Benckiser’s (LON:RB) health and hygiene home division is likely to be among the decisions facing the successor to chief executive Rakesh Kapoor, Citywire has reported. The comments came after the consumer goods group update investors on its full-year performance yesterday, posting better-than-expected sales and noting that it expects momentum to continue in the new year.

Reckitt Benckiser’s share price rose in the previous session as investors cheered the results, gaining 4.64 percent to close at 6,296.00p, and outperforming the benchmark FTSE 100 index which gave up  0.24 percent to 7,219.47 points. The group’s shares have extended their gains in early morning trade, climbed 0.40 percent to 6,321.00p as of 08:01 GMT, as compared with about a 0.21-percent drop in the Footsie.

AJ Bell weighs in on RB

Citywire quoted AJ Bell’s analyst Russ Mould as commenting yesterday that while Reckitt Benckiser chief executive Rakesh Kapoor’s final year at the Nurofen and Vanish maker were unlikely “to be knock-out, they should be steady, with margins held flat and growth between three percent and four percent”.

“Questions for Kapoor’s replacement are likely to include whether to prioritise revenue growth over profitability and whether separating out health and hygiene home should be the precursor to a more formal and permanent split through a sale or spin-off,” the analyst pointed out.

Other analysts on group

Royal Bank of Canada, which is bearish on Reckitt Benckiser with a ‘sell’ rating, set a price target of 5,100p on the shares yesterday, while UBS, which rates the company as a ‘neutral,’ set a valuation of 6,400p on the stock. According to MarketBeat, the blue-chip group currently has a consensus ‘hold’ rating and an average price target of 6,832.78p.

As of 08:17 GMT, Tuesday, 19 February, Reckitt Benckiser Group Plc share price is 6,321.00p.

About the author

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Tsveta van Son
Tsveta van Son is part of Invezz’s journalist team. She has a BA degree in European Studies and a MA degree in Nordic Studies from Sofia University and has also attended the University of Iceland. While she covers a variety of investment news, she is particularly interested in developments in the field of renewable energy.

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