Berenberg has adjusted its outlook on SKAN Group AG (SKAN: SW), a firm specializing in pharmaceutical equipment, by reducing its price target to CHF93 from the previous CHF108. Despite this change, the investment bank continues to recommend a Buy rating for the company's shares.
The decision to lower the price target follows SKAN's first-half results, prompting a revision of earnings estimates and future financial projections. Berenberg cites a cautious stance for the latter half of 2024 and the full year 2025, influenced by current market volatility and the necessity for a strong order book to achieve the group's growth targets.
Berenberg's analysis underscores the importance of a robust order book in the second half of 2024 to support the company's ambition of mid-high teens growth.
The firm's management displayed confidence during recent discussions with Berenberg, providing some reassurance about the company's prospects.
A significant pipeline of sector-wide orders is expected to bolster substantial growth in the financial year 2025.
However, the persistent volatility in the sector and uncertainties regarding project conversion timelines have led Berenberg to adopt a more conservative short-term outlook.
Despite this, the bank maintains a positive view on SKAN's long-term growth trajectory, backed by the company's solid management team and strong fundamentals.
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