UBS Upgrades Close Brothers to Buy, Citing Over 40% Upside Potential

Key Facts

1UBS upgraded Close Brothers Group PLC from 'neutral' to 'buy'.

2UBS set a price target of 555p, implying more than 40% upside from the current price of 383p.

3The stock has declined nearly 40% year-to-date due to fears surrounding motor finance redress.

UBS has upgraded its rating for Close Brothers Group PLC from 'neutral' to 'buy', signaling renewed confidence in the UK specialist lender. The investment bank set a new price target of 555p, representing a potential upside of more than 40% from the current trading price of 383p. This upgrade follows a significant decline in the stock, which has fallen nearly 40% year-to-date due to concerns surrounding motor finance redress. Analysts at UBS argue that the market has overreacted to these risks, creating a substantial undervaluation of the company's shares. Despite ongoing regulatory headwinds, the bank believes the group's recovery prospects are not yet fully reflected in its valuation. This move highlights a shift in sentiment as investors weigh the current risks against the attractive entry point provided by the recent sell-off.