Morgan Crucible's shares jumped Friday after Goldman Sachs upgraded the UK manufacturer to 'buy' from 'neutral'.

Shares climbed 2.49% to 279.70p at 15:55 following the investment banking firm's report Thursday which said Morgan Crucible's valuation represented a 'compelling entry point' for investors considering acquiring stock.

The shares have underperformed in the sector by 26% over the past year in EUR terms. The group issued a profit warning in its 2012 third-quarter report along with a number of UK cyclicals.

It now trades at a discount of 30% to European Capital stocks making it good value for investors.

"We believe Morgan Crucible is continuing on its path to improve the quality of its portfolio," Goldman Sachs said.

"The group is shifting its focus towards higher value added business that is specifically tailored to individual customers. Morgan has also achieved positive price pass-through in each year since 2005, including the 2009 recession, and we believe it can continue to deliver pricing in excess of cost inflation into 2013/14."

The largest UK manufacturers of carbon and ceramic products for industrial use has significant exposure to the rebounding Asian economies, the bank added.

RD

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