Barclays rates GEA Group 'overweight' on longer term margin potential

GEA AG

28/11/2024 07:39

** Barclays initiates coverage of GEA Group  G1AG.DE  with
"overweight", as it sees potential for long-term margin progress
and earnings upgrades for the German food-processing equipment
maker
    ** The brokerage sees the investment case based around
self-help rather than economic factors and says the CEO has done
a good job since taking the role in 2019
    ** The near-term outlook shows subdued recovery in food and
beverages volumes and capital expenditure, Barclays says, seeing
limited potential for earnings revisions near-term
    ** The brokerage expects FY 2025 organic revenue to come in
lower than consensus but margins above consensus
    ** But it projects revenue growth at around 4% for 2026-2027
and sees the top end of margin guidance as achievable
    ** Of 20 analysts that cover GEA Group, 14 rate the stock
"strong buy" or "buy", five rate the stock "hold" and one rates
it "sell"

 (Reporting by Bernadette Hogg)
 ((bernadette.hogg@thomsonreuters.com))