PostNL: stock rises after Jefferies upgrade

(CercleFinance.com) - PostNL shares are up over 4% on Friday after Jefferies upgraded its rating on the stock from "hold" to "buy," citing an attractive valuation.


Analysts said that they have raised their estimates and target price for the stock, from three euros to 4.5 euros, implying 30% upside potential, reflecting increased e-commerce and "exceptional" parcel volumes during the Covid-19 pandemic.

"PostNL now has the highest exposure to parcels, generating 65% of EBIT, and has likely seen the worst in terms of mail volume decline," the Jefferies team wrote in its comments.

Jefferies also pointed out that the share is trading at an attractive valuation, with an equity FCF yield of over 10%, compared to 5% for the sector.

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