JPM puts Wacker Chemie on negative catalyst watch as polysilicon prices worry

Jacobs Solutions

01/07/2024 10:58

** J.P.Morgan places German chemical firm Wacker Chemie
 WCHG.DE  on its Negative Catalyst Watch, expecting material
cuts to estimates post Q2 results due to the recent collapse in
polysilicon prices
    ** JPM expects polysilicon prices to recover the coming
quarters, however not probably above Wacker Chemie cash cost
levels due to the very significant oversupply
    ** The broker notes Wacker's customers for polysilicon are
mainly Chinese companies with production assets in South East
Asia, with some customers cutting production due to potential
U.S. anti-dumping tariffs and current significant industry
oversupply
    ** "Thus, the risk is not only that the further progress for
WCH in securing new contracts on ex. China price stalls but also
that some of the existing volumes where it gets ex. China prices
might weaken in the near-term"
    ** Out of 18 analysts that cover Wacker Chemie AG, 11 rate
the stock "strong buy" or "buy," ​seven rate "hold" and no
analysts rate the stock "strong sell" or "sell"

 (Reporting by Tristan Veyet)
 ((Tristan.chabba@thomsonreuters.com))