In a report released today, Constantin Hesse from Jefferies maintained a Buy rating on Fuchs Petrolub (0LCR – Research Report), with a price target of €58.00.
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Constantin Hesse has given his Buy rating due to a combination of factors that highlight Fuchs Petrolub’s potential for growth and financial stability. The company is expected to benefit from its specialty-driven growth strategy, which is anticipated to drive a compound annual growth rate in sales of 5.1% from 2024 to 2027. Additionally, Fuchs Petrolub is projected to expand its EBIT margin by 190 basis points, reaching 14.2%, which indicates improved profitability.
Another reason for the Buy rating is the company’s strong cash flow generation, with an estimated free cash flow of approximately €1 billion over the next three years. This financial strength is further supported by a solid balance sheet and a free cash flow yield ranging from 5% to 7.5%. These factors, combined with the potential for valuation upside, suggest that Fuchs Petrolub is well-positioned to outperform in the market.
In another report released yesterday, Barclays also maintained a Buy rating on the stock with a €58.00 price target.