UBS cuts Viscofan to 'neutral' as stock price leaves little upside

Viscofan SA

19/01/2023 12:47

** UBS downgrades Spanish meat product packaging company
Viscofan  VIS.MC  to "neutral" from "buy", seeing little upside
to the valuation despite its sound fundamentals
    ** The broker expects good volume growth in 2022-2023, as
the group benefits from financially constrained consumers
trading down
    ** However, trends towards healthier eating could weigh on
sales volumes in the long run, UBS adds
    ** It doesn't rule out future re-rating as price hikes could
lead to margin recovery in 2024-2025
    ** "We expect another c5% price hike this year from
Viscofan," UBS says
    ** Viscofan's USD exposure adds a negative risk to 2023
earnings, as the broker estimates 10% USD depreciation would
have an 8% impact on its EPS
    ** Out of 13 analysts that cover Viscofan, nine rate it
"strong buy"/"buy" and ​four "hold"
 (Reporting by Jakub Olesiuk)
 ((jakub.olesiuk@tr.com))