Wienerberger 'getting ahead of itself', Stifel cuts to 'hold'

Wienerberger AG

06/02/2023 09:28

** Stifel downgrades Wienerberger  WBSV.VI  to "hold" from
"buy" saying the Austrian brickmaker's high new residential
exposure poses a hindrance despite lower inflation
    ** The broker says Wienerberger's exposure to residential
and new built construction, 62% and 71% of sales respectively,
may be a relative "drag" during the first half of 2023 as
residential permits continue to fall in Europe and the U.S.
    ** "We believe that Wienerberger faces a number of one-off
items and trading and cost-related headwinds, which should hold
its earnings back relative to the sector during at least H1-23,"
it says
    ** Citing less favourable earnings momentum than peers,
Stifel cuts 2023 EBITDA estimate for Wienerberger by 6% to 817
million euros ($881 million), though still ahead of consensus of
778 million
    ** The broker adds the stock has "only limited upside
potential to a mid-cycle recession scenario", which does not
offer an adequate margin of safety given the near-term risks of
a housing downturn
    ** The shares are down 3% at 0922 GMT, at the bottom of the
Austrian traded index  .ATX 
($1 = 0.9273 euros)
 (Reporting by Anna Mackenzie)
 ((Anna.mackenzie@thomsonreuters.com))