Up 50%, here’s one of the FTSE 100’s best recovery shares to consider!

Ashtead Group (LSE:AHT) shares plummeted in the months following a shock profit warning at the end of 2024. But they’ve rebounded almost 50% since hitting 12-month lows in April, and continue to gain ground despite broader choppiness on the FTSE 100 leading index of shares.

At £54.70 per share, the rental equipment specialist was last 1.8% higher on Wednesday (3 September). It’s risen again following a robust trading statement in which it raised cash forecasts for the full year.

So can Ashtead’s share price continue its recovery? And should long-term investors consider buying in?

Bouncing back

Ashtead’s been a fantastic growth story over the last decade, driven by its highly successful US expansion strategy. But results have been less impressive of late, with higher interest rates impacting rental equipment demand and product sales.

Indeed, the business trimmed sales guidance multiple times last year, earning it a reputation for regularly underperforming expectations. December’s forecast cut was the last straw for many investors, who ran for the exits.

But trading has been far more robust since then, leading Ashtead’s share price to rise again. Tuesday’s update has further fuelled speculation that the Footsie company is now well in recovery.

Revenues were up 2% between May and July, to $2.8bn, with rental revenues rising by the same percentage to $2.6bn. This marks a return to growth after headline revenues declined 1% in the prior quarter.

Pre-tax profit dropped 4% to $552m, but this was in line with expectations.

Cash forecasts raised

Chief executive Brendan Horgan said revenues improved “as mega project activity gained momentum“. Encouragingly for the rest of the year, he added that “we are seeing positive leading indicators for local non-residential construction activity“.

Adding to the good news, Ashtead also delivered a healthy upgrade to cash flow projections. After near-record free cash flow of $514m in Q1, Ashtead now expects to generate between $2.2bn and $2.5bn of cash in 2025.

That’s up from a prior forecast of $2bn-$2.3bn. The company kept its revenue rental growth forecasts unchanged, at 0%-4%.

A top FTSE 100 share

By also maintaining its capital expenditure targets at $1.8bn-$2.2bn for 2025, Ashtead seems more confident in its future prospects than in December when it slashed spending targets.

I’m not surprised. There are still potential hazards out there as Trump’s tariffs weigh on economic growth and stoke inflationary pressures. But Ashtead is enjoying multiple significant supportive trends that are helping it to rebound, from falling interest rates that are boosting the broader construction industry, to rising infrastructure spending and soaring investment in data centres for the AI boom.

The business, like its rivals, is also benefitting from changing consumer habits. More specifically, rental revenues are rising as individuals and companies increasingly choose to hire equipment rather than outright purchase it.

The big question is whether Ashtead’s share price continues to climb following recent gains? I believe it can, with the stock’s planned US relisting in 2026 making it more attractive to global investors. I’m also confident its commitment to continued expansion will drive fresh price gains as trading conditions improve and profits step higher.

While it’s not without risk, I think Ashtead’s one of the FTSE’s best recovery shares to consider today.