Investing.com - Goldman Sachs upgraded Segro PLC (LON:SGRO) from Neutral to Buy on Monday and raised its price target to £9.00 from £8.00, citing strong letting momentum despite rising vacancy rates in the UK logistics market. The $13.25 billion market cap company has demonstrated remarkable consistency, having maintained dividend payments for 47 consecutive years, according to InvestingPro data.
The company delivered £23 million of new headline rent in the first quarter of 2026 and captured 19% reversion, down from 36% in fiscal year 2025. Segro has approximately £49 million in reversion still to be captured by 2027.
Pre-letting activity was strong in the fourth quarter of 2025, with Segro securing approximately £16 million, marking its strongest quarterly performance since the first quarter of 2024. The company signed a further £12 million of pre-lets in the first quarter of 2026, predominantly driven by data centre-related transactions. With a P/E ratio of 17.86 and revenue growth of 7.56% over the last twelve months, Segro maintains a "GOOD" financial health score on InvestingPro.
Segro targets one to two fully fitted data centre developments per year, with Goldman Sachs maintaining capital expenditure assumptions at £725 million in 2027 and £775 million by 2028. The company’s EPRA cost ratio stood at 17.5% in fiscal year 2025.
The company’s loan-to-value ratio stood at approximately 31% in the first quarter of 2026, supported by £106 million of disposals completed during the quarter and a further £138 million exchanged and expected to complete over the remainder of 2026. Despite Goldman’s upgrade, InvestingPro analysis suggests the stock is currently overvalued relative to its Fair Value—placing it among stocks on the most overvalued list. Investors can access a comprehensive Pro Research Report on Segro, one of 1,400+ available reports offering expert analysis and actionable intelligence.
In other recent news, UBS has downgraded Segro PLC from a Buy to a Neutral rating, citing valuation concerns. Despite the downgrade, UBS raised its price target for Segro from GBP8.15 to GBP8.40. The firm had previously highlighted Segro as its top UK pick for 2026, based on an attractive starting valuation and improving operational momentum. Segro’s shares have risen approximately 10% year-to-date, outperforming peers, although they have experienced a recent pullback. These developments reflect UBS’s reassessment of Segro’s valuation amid early signs of recovery in its core markets.
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