Broke with my usual MO and forked out a few quid to buy the house note, which in my opinion explains why VP is drifting south and will offer a nice buying opportunity shortly.
They have put forward a very minor increase in their estimate for 2003, increasing eps from 12.2 to 12.3p! Accompanied with words such as prudent and conservative. This based on a view that the forecast growth in H2 would return to a more normal level following the excellent H1 result. However they remain confident that the group can continue to deliver eps growth at or in excess of management's 10% pa target.
The note rates VP a buy with a 12 month target price of 130p and claim that with a 14% ROCE, VP should trade at a premium to the competition and in excess of the £1.05 NAV.
They state seasonal reasons for not being able to maintain H1 growth. I agree that H1 will not be matched in H2, however I do expect at least 10% on last years H1, which means VP will easily outperform the house forecast and should make 130p inevitable. I am staying with my watching brief, holding present stake, and intend to buy more on the present weakness.
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