Building products business CSR has rallied impressively from its almost 40% sell-off and although it feels rich around $5 when we consider its 11.7x valuation and forecasted 6.8% yield over the next 12 months it’s easy to comprehend why it has been the stock of choice for investors looking to hold some exposure to construction – this is not the stock we would opt for when the sector turns but it is the safer play for those that believe, like Macquarie, that the downturn has at least another 18 months to play out.
- We have been impressed and surprised by CSR’s recovery from its 2022 low but ~$5 is not exciting to us.
MM is neutral on CSR
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