Jefferies analyst Hannes Leitner maintained a Hold rating on Worldline today and set a price target of €3.80.
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Hannes Leitner has given his Hold rating due to a combination of factors influencing Worldline’s financial performance. The company’s Q2 revenues saw a 4% organic decline, slightly missing expectations, which contributed to an overall 3% decline for the first half of the year. Additionally, the net new revenue (NNR) decreased by 7.3% in Q2, with the spread widening significantly compared to the previous quarter.
Operating expenses increased by 2%, leading to a 7% miss in EBITDA. The new guidance provided by Worldline indicates a low single-digit decline, which is below consensus expectations for both revenue and EBITDA. Furthermore, the free cash flow forecast is substantially lower than anticipated. The recent announcement of the MeTS sale for €400 million, at multiples below industry averages, also plays a role in the Hold rating, as it reflects the company’s current valuation challenges.
In another report released on July 23, Deutsche Bank also maintained a Hold rating on the stock with a €4.00 price target.