(Finance) – Alantra he lowered to 4.2 euros per share (from the previous 4.5 euros) the target price on Bifirea company listed on Euronext Growth Milan and active in the production of materials for fire protection and thermal insulation in the construction and industrial sectors, confirming the recommendation on the title to “Buy” given the potential upside of 39%. The revision of the rating came after the company communicated its results for the first half of 2023.
Analysts write that the results (with sales and EBITDA already reported) showed a weak revenue performance in a difficult context (-3.6% y-o-y) with a strong expansion of the EBITDA margin (25.2% of sales, +320 bps compared to 1H22). Investments, mainly relating to the fourth production plant, and the absorption of net working capital led to a net debt position of 0.1 million euros (from net liquidity of 1.4 million at YE22).
Alantra increased the esteem of FY23 EBITDA of +5.7%, while confirming other data. Expanding production capacity to penetrate the DACH area and broaden the product portfolio should protect against weak domestic demand. Furthermore, it substantially confirmed FY23 revenues (-5% yoy, which implies a conservative deceleration of -6.5% in 2H), with an EBITDA of 9.3 million euros/22.2% margin (+5, 2% yoy).
“We believe that despite the current environment characterized by short-term headwinds, i favorable factors in the medium and long term resulting from the decarbonisation trend in EU building renovation represent clear upside potential,” the research reads.
Despite strong year-to-date performance (+20%), Bifire is down 18% since the IPO. The stock trades at a “significant discount” 40% on EV/EBIT 23 compared to international manufacturers of innovative building materials, it is noted.