Metro: Invest Securities cuts target price

(CercleFinance.com) - Invest Securities has placed the stock of German retailer Metro under review (against Neutral) and has cut its corresonding target price to 9.
3 euros (vs. 13 euros previously).

The broker says that Metro AG is a structurally difficult file, despite conceptual virtues, which is often overexposed to exogenous factors, such as the Covid-19 health crisis, which will hit it hard in Q3 (the second quarter of the calendar year).

Invest Securities adds that Metro has withdrawn its guidance, stating that its BM (CHR) could lose up to 70% of the total, which also will only be slightly offset, evaluating that sales will fall by up to 500 million euros per month in the event of lockdown or similar.

On this basis, FY EPS would collapse to 0.19 euro. The matter is whether a return to normal in 2021 could justify a rapid recovery in the share price. This is not certain, as there is no guarantee that things have already bottomed out.


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