Mersen: further upside according to SG; targets 35 euros.
(CercleFinance.com) - The share of carbon product specialist Mersen has already soared by almost 40% y-t-d.
However, according to analysts at Société Générale (SG), the share still has further upside potential. Maintaining a buy rating on the stock, the broker has raised its 12-month target price from 30 euros to 35 euros.
Mersen, which began 2017 on the right footing, is expected to continue along these lines over the full year: " After a good 1Q, we expect further LFL sales growth in 2Q17 (due 31 July)," SG predicts ahead of the group's interim accounts, which are due out on 31 July.
“Thanks to a lower breakeven point, we see more earnings upside in the near future.” SG adds, which distinguishes between the better trends in Advanced Materials and scope for an acceleration in the recovery in Electrical Power, which justifies a 25-basis point increase in its FY 17e recurring operating margin estimate to 8.55%. SG has also raised its EPS estimates until 2019.
“After years of gradual margin deterioration, we see FY16 as the trough and we now expect a +75bp recovery in FY17e,” the note adds.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
However, according to analysts at Société Générale (SG), the share still has further upside potential. Maintaining a buy rating on the stock, the broker has raised its 12-month target price from 30 euros to 35 euros.
Mersen, which began 2017 on the right footing, is expected to continue along these lines over the full year: " After a good 1Q, we expect further LFL sales growth in 2Q17 (due 31 July)," SG predicts ahead of the group's interim accounts, which are due out on 31 July.
“Thanks to a lower breakeven point, we see more earnings upside in the near future.” SG adds, which distinguishes between the better trends in Advanced Materials and scope for an acceleration in the recovery in Electrical Power, which justifies a 25-basis point increase in its FY 17e recurring operating margin estimate to 8.55%. SG has also raised its EPS estimates until 2019.
“After years of gradual margin deterioration, we see FY16 as the trough and we now expect a +75bp recovery in FY17e,” the note adds.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.