Citi expects further downside revisions to Reliance Worldwide stock

Reliance Worldwide

04/10/2022 20:50

** Citi says despite favourable stamp duty concessions
in the UK, impact to rates is incrementally more negative for
housing activity and expects further downside revisions for
Reliance Worldwide  RWC.AX  stock
    ** RWC manufactures water flow related products for the
plumbing industry 
    ** Last week, under newly-appointed Prime Minister Liz
Truss' mini-budget, Britain cut stamp duty, a tax on house
purchases  urn:newsml:reuters.com:*:nL8N30U20I
        ** Citi estimates "concessions work out to be less than
a ~2,500 pounds benefit to either existing or first home buyers,
looks largely immaterial to us"
        ** Says increase in mortgage rates have more material
impact on housing activity
        ** "We await to see the outcome of further fiscal
announcements set for what appears to be October 22 before
making any revisions" - Citi
        ** Citi estimates that more than 30% RWC's EBITDA could
come from United Kingdom
    ** Seven of 14 analysts rate the stock "buy", six "hold" and
one "strong sell"; their median PT is A$4.83 – Refinitiv data
    ** Stock down 44.3% this year, as of last close
 (Reporting by Nausheen Thusoo)
 ((Nausheen.Thusoo@thomsonreuters.com;))