London’s Hottest Blue-Chip Stock of 2021 Is Decidedly Low Tech
London’s Hottest Blue-Chip Stock of 2021 Is Decidedly Low Tech
(Bloomberg) --
Ashtead Group Plc consolidated its position as Britain’s top-performing blue-chip stock this year after second-quarter results showed it boosting its share of the U.S. equipment-rental market.
Shares in the London-based firm gained as much as 4.8%, extending their 2021 rally to about 85%. That’s far bigger than the 13% year-to-date gain for the benchmark FTSE 100 Index, whose next-best performer is cybersecurity firm Darktrace Plc with an increase of 71%.
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Ashtead, owner of U.S. equipment hire company Sunbelt Rentals, reported a 20% rise in half-year rental revenue year-on-year. It opened 58 new locations during the period ended Oct. 31 at a cost of $1.63 billion through investment in existing locations and bolt-on acquisitions.
M&A in the U.S. equipment rental market is helping the three big firms -- Ashtead, United Rentals Inc. and Herc Rentals Inc. -- get bigger, according to Bloomberg Intelligence, which says the U.K. company has been the most aggressive on greenfield store openings.
“We feel Ashtead should be able to command a premium rating,” Citigroup Inc. analyst Marc Van’T Sant said in a note, citing double-digit earnings growth potential.
Ashtead was up 2.1% to 6,328 pence as of 9:40 a.m. U.K. time.
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