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Highlights

  • Berenberg issues a "BUY" rating with a target price of GBp 6,000, projecting a 29.1% upside.

  • Group delivered record rental revenue growth of 4% for the year ending 30 April 2025.

  • Free cash flow of $1.79 billion and leverage ratio reduced to 1.6 times.

Ashtead Group PLC (LSE:AHT.L) has received a reaffirmed "BUY" rating from Berenberg, with analyst Carl Raynsford assigning a price target of GBp 6,000 per share. This reflects a potential upside of 29.1% from the current trading price of GBp 4,647. 

With a current target price of GBp 5,346.29 across broader analyst consensus and a long-term growth expectation of 8.17%, Ashtead remains firmly in investor focus.

Full-Year Financial Performance Reinforces Confidence

For the financial year ended 30 April 2025, Ashtead Group delivered a solid operational performance amid a softer macro environment. The company reported record Group rental revenue, up 4% compared to the previous year, despite a 1% decline in total revenue caused by reduced sales of used equipment.

Operating profit for the year stood at $2.56 billion, slightly lower than the previous year due to a $142 million reduction in gains on disposal. Adjusted profit before tax reached $2.13 billion, while adjusted earnings per share were recorded at 369.5¢.

Ashtead also declared a final dividend of 72¢ per share, bringing the total dividend for the year to 108¢, up from 105¢ in FY24. This reflects the company’s consistent approach to shareholder returns, even while managing lower capital investment compared to the prior period.

Cash Flow and Balance Sheet 

One of the most encouraging metrics for investors was Ashtead’s free cash flow, which surged to $1.79 billion for FY25, up significantly from $216 million in the prior year. Capital expenditure came in at $2.4 billion, lower than FY24’s $4.3 billion, indicating a strategic pullback to enhance cash reserves.

The company also improved its financial position, with net debt to adjusted EBITDA leverage reduced to 1.6 times, compared to 1.7 times in the previous year. 

Forward Guidance Signals Steady Growth

Looking ahead to FY26, Ashtead expects rental revenue growth in the range of 0% to 4%, with gross capital expenditure projected between $1.8 billion and $2.2 billion. Free cash flow is expected to remain strong, between $2.0 billion and $2.3 billion.