Sixt up after Jefferies raises to 'buy' on solid travel outlook

Sixt SE

31/01/2023 09:02

** Shares in Sixt  SIXG.DE  rise about 5% after Jefferies
raised rating on the German rental car company to "buy" from
"hold"
    ** The broker says it sees an overall more resilient travel
industry than it initially forecast for 2023, with preliminary
figures from Sixt confirming stable year-on-year prices
    ** "With a solid 2023 travel and improved macro outlook,
continued elevated prices and growth acceleration in 2024, we
believe Sixt should trade more in line with its historical
pre-Covid price-to-earnings ratio," it says
    ** While growth is expected to be held back short term due
to macro headwinds, Jefferies anticipates Sixt will "continue
gaining market share in key European markets and the US in the
medium term as it focuses on growing its station network and
brand awareness"
    ** In addition, it expects the group's average fleet in 2023
to be above 2019 levels with a wider variety of vehicles,
particularly as it pursues its electrification objectives
    ** "We also expect Sixt to lower its risk fleet to closer to
20% from 35% today, lowering its exposure to secondary market
price swings," Jefferies adds
    ** The stock, on track for its best day in four months, tops
the German mid-caps index  .MDAXI 
 (Reporting by Anna Mackenzie)
 ((Anna.mackenzie@thomsonreuters.com))