Stifel has initiated coverage of MHA with a 'buy' rating and a 205p target price, representing a 35% upside from the stock's recent closing price of 151.5p. The target is based on a discounted cash flow model using a 9% weighted average cost of capital and 2.5% terminal growth rate. At this price, the stock would trade at approximately 18.7x forward earnings, which analysts view as attractive given MHA's strong fundamentals.

MHA, a mid-market professional services firm offering audit, tax, and advisory services, listed on AIM in April 2025, raising £98 million at 100p per share. Since listing, the shares have risen 51.5%, outperforming the FTSE All Share's 26% gain over the same period. The firm reported revenues of £224.2 million in fiscal year 2025, up 45.5% from £154 million the prior year. Stifel forecasts revenues of £250 million for fiscal year 2026, rising to £274.4 million in fiscal year 2027.

Stifel highlights MHA's exceptional track record, strong recurring revenues, and attractive growth opportunities as key investment merits. The firm generates approximately 87% of revenue from recurring contracts, primarily annual audit and tax engagements, with a client retention rate above 90% across approximately 17,000 clients. Since listing, MHA has completed two international acquisitions: Baker Tilly South-East Europe for €24 million and Moore Stephens UAE for £7.4 million. Management has set a medium-term revenue target of £500 million, which Stifel views as achievable by fiscal year 2030 through organic growth and acquisitions.