Barclays resumes coverage of Tate & Lyle at 'overweight'

(Sharecast News) - Barclays resumed its 'overweight' coverage on Tate & Lyle on Thursday with a 930p price target as it pointed to a "new era" with significant total shareholder return potential.
The bank said Tate's announcement confirming the separation and sale of its Primary Products assets in July 2021 didn't prove to be an immediate positive catalyst.

"However, as the deal nears completion we think the market has better digested its complexity as well as the initial sticker shock from earnings dilution (which balance sheet firepower can diminish) so is now able to focus on the opportunity that lies ahead," it said.

"There have been false dawns on Tate's journey from commodity processor to value-added solution provider, but this transformative deal represents a repositioning that fundamentally increases the structural growth opportunity for Tate's portfolio of ingredient solutions.

"With a highly credible ExCo and board, we believe Tate is entering a new era that could provide significant TSR opportunity from both growth and re-rating."

At 1430 GMT, the shares were up 2.4% at 731.80p.