Share of the week: Breedon Aggregates
“As a provider of materials to the construction and building industry, Breedon Aggregates has seen margins improve lately, helped by lower costs, stable pricing and acquisitions. Furthermore, an update this month stated that earnings for the year are now expected to be ahead of market expectations and management are upbeat regarding its future.
“The outlook for construction, especially in the housing market, is looking more positive. The company has been positioning itself to benefit from any pick-up in the economy and demand for its products, leading to a number of acquisitions. These acquisitions should not only help expand Breedon’s geographical presence in the UK, but also make a significant and growing financial contribution to the company.
“We recommend Breedon Aggregates as a ‘buy’ for long term investors. As well as management reiterating confidence of further progress this year, the share price has risen by around 50% since our recommendation in September 2013, courtesy of continued recovery in the sector.”