Business

Ashtead Group for a £38million windfall following Hurricane Harvey | City & Business | Finance

The equipment rental firm should benefit from the multibillion dollar clean-up programme after Hurricane Harvey caused devastation across Texas, with Hurricane Irma set to sweep across southern Florida today.

The FTSE 100-listed business generates more than 90 per cent of its revenues through US division Sunbelt.

Justin Jordan, equity analyst at Jefferies, calculates that Sunbelt could generate $50million (£37.8million) in disaster recovery rental revenues from Hurricane Harvey, plus earnings from rebuilding work and possible flood defence spend.

Irma may also require a major clean-up operation.

“Ashtead has 84 equipment branches in Texas and another 58 across Florida, so is well placed to assist in both immediate disaster recovery activity and longer term rebuild work.”

Jordan forecasts a 12 per cent rise in quarterly rental revenues and 25 per cent growth in profits before tax to £229.2million.

The group’s share price is up 400 per cent in the last five years and Graham Spooner, investment research analyst at The Share Centre, said: “Ashtead should continue to benefit from strong infrastructure and construction spending in the US.” 

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