IMI Q1’26 Trading Update Conference Call - Feedback

研报英文原文证据摘录

IMI Q1’26 Trading Update Conference Call - Feedback

Chitrita C Sinha AC Europe Equity Research

(44-20) 7742-7176 12 May 2026 C A Z E N O V E

chitrita.sinha@jpmorgan.com

Investment Thesis, Valuation and Risks

IMI (Overweight; Price Target: 3,050p)

Investment Thesis

• Since Roy Twite became CEO in 2019, the business has seen a significant step up in

performance with organic growth, margins and ROIC all improving. On most metrics,

IMI has closed the gap with peers, and in some cases, is now exceeding the peer group.

Despite this, the shares have de-rated relatively, highlighting the value on offer for a

significantly improved business.

• While PA has accounted for the bulk of the organic recently, we see scope for more

balanced earnings growth now. We expect continued strong growth in PA (good trends

in multiple end markets; oil concerns overstated); and are more optimistic in Climate

Control, IA and Life Sciences. We see upside risk to forecasts.

• The group’s improved and strong FCF generation also leaves plenty of scope for M&A

and buybacks.

Valuation

• We set our price target using an EV/EBITA based on a SOTP valuation. Using a detailed

approach to identify relevant peers and analyse financial performance, we derive our

June 2027 price target applying our target multiples to our 2027 forecasts and rolling

forward 6 months.

Risks to Rating and Price Target

• A weaker-than-expected macro recovery could put pressure on industrial production

levels and our short-cycle earnings forecasts.

• Greater-than-expected pressure on later-cycle earnings, largely in Process Automation,

would put pressure on our forecasts.

• Achieving the strategic objectives proves either slower or more expensive than expected

or ultimately are not achieved. This would put pressure on the multiple.