RS Group plc "Another delay to recovery hopes?" (Neutral) McKenzie

Research evidence excerpt

RS Group plc "Another delay to recovery hopes?" (Neutral) McKenzie

Powered by Lab Global12 MayResearch2026ab Evidence UBS YES

RS Group plc Equities

United KingdomAnother delay to recovery hopes?

Industrial Services

12-month rating Neutral

Earnings growth prospects likely pushed out even further; Neutral, 620p PT

Along with many distribution companies, RS Group has been faced with profit 12m price target 620p

normalisation pressures and weak customer demand over 2023-25. The company looks Prior : 750p

to have stabilised profits (adj. EBITA -35% from Mar'23 peak, albeit still +20% from the

Price (11 May 2026) 616p

pre-pandemic level), but we believe that it is unlikely to drive a return to growth over

2026 given further cyclical risks, limited evidence of accelerating market share gains, RIC: RS1R.L BBG: RS1 LN

and the need to balance cost savings with reinvestments. As a result, we forecast profits

Trading data and key metrics

to trend broadly sideways in the y/e Mar'27e (vs. consensus forecasting +5-6% growth),

52-wk range 733p-542

and so see the current c16x fwd PE as fair for profits that are stabilising at low levels. Our

updated Price Target is 620p and we remain Neutral-rated. Market cap. £2.89b/US$3.95b

Shares o/s 470m (ORD)

Cyclical conditions challenging; limited evidence of growing structural gains Free float 100%

Given RS Group operates in broad and highly-fragmented markets with a digital-led Avg. daily volume ('000) 1,697

model, we have long seen a significant organic growth opportunity. However to capture Avg. daily value (m) £10.5

this it needs consistent new wins (in terms of wallet share gains and new clients), while Common s/h equity (03/26E) £1.41b

in the short-term it can be somewhat dependent on customer activity levels; we P/BV (03/26E) 2.0x