'Another tough profit warning': Baader downgrades Norma

Norma SE

22/07/2022 10:38

** Baader downgrades German engineering group Norma
 NOEJ.DE  to "add" from "buy" and cuts target price by 46% to
EUR 25 after "another tough profit warning" due to higher
material, energy, and logistics costs 
    ** Norma on Thursday forecast adjusted EBIT margin of around
8% vs 11% previously, and net operating cash flow of around 60
million euros ($60.9 million) against earlier 100-million-euro
target  urn:newsml:reuters.com:*:nASM000K8B 
    ** "With the renewed profit warning the management has lost
a lot of confidence," says Baader, adding the pre-released Q2
results showed higher than expected sales but "disappointing"
profitability
    ** The broker warns investors will be reluctant to factor in
high margin recovery potentials amid current recession fears,
even if fundamentally the shares are undervalued and would look
highly attractive in a healthy economy
    ** Shares of Norma are down 7.6% in morning trade, and have
fallen around 46% since the start of the year
    ** Out of 15 analysts that cover Norma, six rate it "strong
buy" or "buy", ​eight "hold" and one "sell"

($1 = 0.9851 euros)

 (Reporting by Elitsa Gadeva)
 ((Elitsa.gadeva@thomsonreuters.com))