(News Bulletin 247) – Stifel downgrades its recommendation on Lanxess from ‘buy’ to ‘hold’, with a price target reduced from 51 to 33 euros, seeing the cyclical and structural risks persist for the German specialty chemicals group.
‘The earnings warning indicates a 30% drop in adjusted EBITDA in annual comparison, which is too significant to convince the markets of the better resilience of the new portfolio’, underlines the broker.
‘Structural issues should be addressed, but we don’t expect a quick settlement’, says Stifel, who acknowledges a 22% upside potential reflected in his target price, but anticipates continued stock price volatility .
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