There’s good value to be had on the buses according to UBS, which has upgraded Go-Ahead PLC to a buy on the back of a faster than expected recovery in regional passenger numbers.
The market is undervaluing the group’s regional bus operations by about 30% on the back of overly pessimistic assumptions in the recovery of passenger volumes, calculates the Swiss broker.
UBS is also one of the brokers that thinks Go-ahead will resume dividends this year and by next be running at 70p per share, with 35p to be announced with the full year results ion Thursday.
The price target is now 1,240p, from 1,380p, but buy is now the view on valuation grounds.
Shares rose 3.5% to 1,004p.