JPM puts Carl Zeiss on negative Catalyst Watch on downside risks to earnings

Carl Zeiss Meditec AG

31/05/2024 09:17

** J.P.Morgan places Carl Zeiss Meditec  AFXG.DE  on
negative Catalyst Watch, citing downside risks to 2024 guidance
and 2025 consensus
    ** The German medical technology firm's stock is down 2.85%
    ** JPM says a cut to 2024 outlook (potentially at Q3) is
"well flagged" although the magnitude of guidance downgrade
remains the key uncertainty
    ** It predicts 2024 adjusted EBIT and EPS to be 9% and 10%
below consensus respectively, adding the risks to 2025 numbers
are "underappreciated"
    ** Consensus foresees EPS growth of 26% for 2025 based on
2024 earnings, which JPM says "are too high"
    ** The brokerage points to an earnings downgrade cycle
through 2023 and 2024, flagging further downside risk to
estimates
    ** Although the stock is traded broadly in-line with
ophthalmology peers, it is located in the bottom quartile in
terms of earnings growth, it adds
    ** Recent outperformance from peers may signal market share
losses for Carl Zeiss, it says

 (Reporting by Amir Orusov)
 ((Amir.orusov@thomsonreuters.com))