Young & Co.'s Brewery A Sound H2; Encouraging current trading despite tough comps, FY 27 to be underpinned by a busy sports calendar

研报英文原文证据摘录

Young & Co.'s Brewery A Sound H2; Encouraging current trading despite tough comps, FY 27 to be underpinned by a busy sports calendar

Karan Puri AC Europe Equity Research

(44-20) 7742-8342 21 May 2026 C A Z E N O V E

karan.puri@jpmorgan.com

Investment Thesis, Valuation and Risks

Young & Co.'s Brewery A (Overweight; Price Target: 1,190p)

Investment Thesis

We like Young’s straightforward business model. Its sole focus on running managed

premium pubs in southern England (c.70% London exposure), with no complexity of

orchestrating different operating models (managed vs franchised vs tenanted) or catering to

different customer segments (premium vs value end) allows for a well optimised and

streamlined cost base. Separately, its well-invested (non-branded) differentiated pub estate

(>80% freehold) drives an appealing profitability profile, with EBITDA margin towards the

higher end of the sector range at c.23%. Its recent City Pubs acquisition comes across as a

good business fit (premium, city, non-branded exposure, in line with that of Young’s), with

attractive cost synergies lined up in the pipeline from improved food and drinks contracts.

Last but not least, Young’s is the only company within our Pubs coverage with a recurring

dividend for shareholders (pay-out averaging c.50%).

As a result, we rate the shares OW.

Valuation

Our Dec-27 PT of 1,190p applies an 8x multiple to our FY 29e adj. EBITDA (March ending

FY). This is a 25% discount to its pre-COVID five-year average (vs MARS/MAB 20%/10%

resp), reflective of concerns around UK macro, the disposal of tenanted and leased pubs

(higher margin and more defensive), liquidity constraints (given AIM listing) and

structurally lower margins post-COVID.

Risks to Rating and Price Target

Downside risks to our rating are as follows: