(News Bulletin 247) – Stifel maintains its ‘hold’ rating on the Safran share, with an unchanged price target of 145 euros.
The analyst estimates that Safran is the dominant company in the narrow-body engine market via CFM International, the Safran/GE joint venture which captures nearly 70% of the market and remains the sole engine supplier for the B-737 family.
Although it models an average annual increase of 24% in adjusted EBIT between 2022 and 2025, Stifel remains 4% below consensus estimates, with the broker claiming to be more cautious than the consensus on the ‘Propulsion’ and ‘Interiors’.
“In our view, the current valuation accurately reflects strong EBIT growth prospects but ignores Safran’s history of adding new, margin-diluting businesses to its portfolio, which we are not particularly excited about,” said essentially the broker.
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