Hauck Aufhäuser initiates Grenke with 'buy', shares rise

Grenke AG

05/07/2024 09:54

** Shares in Grenke  GLJn.DE  are up 2.4% after Hauck
Aufhäuser initiates the German leasing company with "buy",
saying its net income looks set to grow by a double-digit
percentage again after weak COVID years
    ** Full-amortisation contracts, meaning built-in negligible
residual value risk, differentiate Grenke from other leasing
companies, the brokerage says
    ** It says Grenke's unique selling proposition rests on an
effective in-house credit scoring algorithm, highly automated
processes leading to cost benefits, attractive and reliable
refinancing conditions and scale benefits, among others
    ** "Growth should largely stem from entering new markets and
an expansion of product categories, enabling new business to
grow at a 14% CAGR into 2026E," it says
    ** New leasing business benefits from a growing market
penetration, as SMEs seek to preserve cash and avoid the hassle
of hardware obsolescence, it adds
    ** Out of six analysts that cover Grenke, five rate the
stock "strong buy"/"buy"​ and one "strong sell" - LSEG data

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