El En drops after Berenberg cuts it to 'hold', citing tough year ahead
20/03/2023 09:44
** Shares in Italy's El En ELEN.MI extend Friday's losses
and fall as much as 9.4% after Berenberg downgraded the laser
equipment maker to "hold" from "buy"
** The broker says although there were no surprises in the
company's FY results last week, the guidance for 2023 was
disappointing and weaker-than-expected
** It adds while the group expects another record year for
revenues, the profitability may be dented by its industrial
division that runs on lower profitability, lower demand for
aesthetics lasers and a possible decrease in overall demand
** "While we still like the structural trends supporting
El.En's growth, we prefer to wait for a better entry point into
the shares," Berenberg says
** However, it says a successful IPO of the cutting division
could act as a positive catalyst for the shares
** The broker cuts its near-term estimates on El En for both
2023 and 2024 and reduces the group's target price to 15.3 euros
($16.31) from 16.1 euros ($17.17)
** The stock was down 7% by 0939 GMT, underperforming
Italy's all share index .FTITLMS , which slips 0.4%
($1 = 0.9379 euros)
(Reporting by Alessandro Parodi)
((alessandro.parodi@thomsonreuters.com))