Intertek: Oddo confirms target price

(CercleFinance.com) - Given the situation in China, Oddo has reduced its organic growth forecasts for May-June for Products (63% of sales) with the continuing closures in Shanghai (25% of sales in China), which should result in the loss of 50% of revenues in June.


Analysts now expect organic growth of 2.5% (vs. +10% previously), resulting in expected growth of 3.8% in H1, they say.

The inspection and certification company said that business in China (20% of sales) should normalise in July and expects a catch-up effect in H2.

Overall, the broker expects a 15.2% margin in H1 2022, compared with 15.2% in 2021, 12.6% in 2020 and 17.3% in 2019. Over the full year, strong pricing power, cost control and productivity gains should enable the group to improve its margins, Oddo says.

The group says it is on track to achieve its 2022 targets, despite the impact of lockdowns in China.

Oddo's estimates are broadly in line with the consensus for 2022, with the broker maintaining its Neutral rating on the stock, along with a target price of 6,000p.


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