In a report released yesterday, Marco Vitale from Mediobanca maintained a Hold rating on SECO S.p.A., with a price target of €3.50.
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Marco Vitale has given his Hold rating due to a combination of factors influencing SECO S.p.A.’s current market position. The company has shown a promising recovery in demand, with revenues increasing at a high single-digit rate, and a notable improvement in its adjusted EBITDA margin, which reached 22.3%, the highest in six quarters. This margin expansion was supported by a solid gross profit margin and operating leverage, which led to a 12% increase in EPS estimates and a raised target price of €3.5 per share.
Despite these positive developments, the stock is currently trading at 21 times the estimated FY26 adjusted P/E, suggesting limited short-term upside potential. Marco Vitale maintains a Neutral rating, as the medium-term growth prospects hinge on the successful ramp-up of CLEA sales, which is expected to transform SECO’s business model into a more integrated IoT solutions provider. This transformation could unlock more profitable growth opportunities, but until then, the Hold rating reflects a cautious approach given the current valuation and market conditions.