Jefferies cuts CompuGroup to 'hold,' sees growth slowdown in H2

CompuGroup Medical SE & Co KgaA

29/08/2023 12:13

August 29 -    ** Jefferies sees German medical
software company CompuGroup  COP1n.DE  as an interesting story,
but cuts the stock to "hold" from "buy," attributing current
execution and growth to price increases and M&A
    ** The broker's forecast indicates CompuGroup slowing growth
in H2 and reaching slightly higher margins to achieve FY23
guidance of about 5% organic growth with EUR 260-300 million in
adjusted EBITDA
    ** Jefferies is of opinion CompuGroup misses again its
medium-term forecast, which called for about 25% margin in FY23
(2% miss expected on consensus mid-point), and has "high doubts"
about the company's plans to increase margin to about 27% by
FY25 (JEFe 24.6%, consensus 24.9%) 
    ** The brokerage says it "struggles" to see positive
catalysts for the stock in the near-term, although it sees
downside risk as limited
    ** It adds the company should present a CFO and establish a
better execution track record, given the continued failure to
meet medium-term forecasts in particular
    ** Out of 13 analysts that cover CompuGroup, nine rate the
stock "strong buy"/"buy,"​ three rate it "hold" and one rate the
stock "sell" - Refinitiv data

 (Reporting by Mateusz Dobrzyniewski)
 ((Mateusz.dobrzyniewski@thomsonreuters.com))