Everyone loves an underdog, and Breedon (BREE) used to be just that. When Investors’ Chronicle drew attention to the company in May 2023, it had just jumped from the Alternative Investment Market to the main exchange. At the time, shares were worth 338p. Now they’re worth well over 400p, and the company has also grown its dividend. All in all, it was a good call.
Tip style
Growth
Risk rating
High
Timescale
Long Term
Bull points
- Strong track record of growing through acquisitions
- Targeting a fragmented US market
- Strong performance in Ireland
- Demand could rebound in the UK
Bear points
- Plenty of other companies have failed in the US
- Poor UK economic growth
However, Breedon still looks cheap. The supplier of cement, asphalt and aggregates trades at 11.5 times its forward earnings, well below its ten-year average of 16 times and its five-year average of 14 times. In fact, it is sitting on the same multiple as when we last flagged it, despite making good headway over the past two years.