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MBH

Michelmersh Brick Holdings PLC

Construction and Materials First-pass screen £66m
340/1000 Overall fit
AI beneficiary 35% 30
Operating leverage 25% 42
Valuation 25% 30
Downside protection 15% 40

First-pass take

Cyclical brick manufacturer with zero AI exposure, hit by sector demand trough (UK brick despatches down 30% since 2022) and margin compression (gross margin −310bps YoY). Net cash £6m plus undrawn facility provides some downside protection, but profitability down 36% YoY with elevated capex limiting near-term upside. Recovery hinges on interest rate relief.

Flags

cyclicalsector-troughmargin-compressionrate-sensitiveno-valuation-datacapex-cycle