Analyst Edward Hall CFA of Stifel Nicolaus maintained a Buy rating on Gerresheimer (0NTI – Research Report), with a price target of €97.00.
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Edward Hall CFA has given his Buy rating due to a combination of factors including Gerresheimer’s recent financial performance and future growth prospects. Despite the company’s FY24 organic growth falling slightly below expectations, the Primary Packaging Glass segment showed a significant sequential quarterly growth of 15%, which contributed to a stronger EBITDA margin in the fourth quarter. This indicates a potential market recovery, aligning with positive comments on order book growth.
Moreover, while the Free Cash Flow has been a concern due to higher leverage and cash adjustments, the company’s guidance for FY25 suggests a possible improvement with an implied organic growth of 5.8%. Although there are risks associated with the integration of Bormioli and the current leverage levels, the reset of medium-term growth expectations to 8-10% provides a more realistic outlook. Edward Hall believes that once expectations have normalized, Gerresheimer’s stock has the potential for upside, justifying the Buy rating.
In another report released today, J.P. Morgan also maintained a Buy rating on the stock with a €111.40 price target.