Bernstein starts Sartorius, unit Stedim with 'underperform' on 2028 outlook risks

Sartorius AG

30/07/2024 11:42

** Bernstein initiates German biomanufacturing firm
Sartorius  SATG.DE  and its French bioprocessing unit Sartorius
Stedim Biotech  STDM.PA  with "underperform", citing risks to
2028 targets given weak order intake and changing business
demand patterns
    ** It expects Sartorius to cut its FY 2028 guidance further,
and says it does not see clear signs of a rapid recovery in
revenue growth at its Bioprocess Solutions (BPS) unit, while the
Lab Products & Services (LPS) unit remains "a margin destroyer"
    ** Bernstein says Stedim's Q2 results published on July 18
confirmed its weak position vs peers, and calls its 35% core
EBITDA margin target for 2028 "overly optimistic"
    ** Short and long term (2025-30) visibility is too low for
Sartorius to re-establish its pre-pandemic growth rate, and the
current valuation prevents any P/E expansion, Bernstein says
    ** It says a stringent cost-control plan is required for
Stedim to make up for its lack of scale and preserve its margin
over the next two years

 (Reporting by Amir Orusov and Anastasiia Kozlova)
 ((Amir.orusov@thomsonreuters.com;
Anastasiia.kozlova@thomsonreuters.com))