(Finance) – Intesa Sanpaolo he cut to 28.5 euros per share (from the previous 32.5 euros) the target price on MO-FRIa company listed on Euronext Milan and active in the air heat exchanger sector, confirming the recommendation on the title to “Buy“. Analysts said that 9M23 revenues were broadly in line with 9M22 and EBITDA was slightly better, and a similar pattern should also occur for FY23 data. Despite continued economic weakness, the management is confident of achieving revenue growth and improving profitability in FY24, thanks to the diversification of applications. Positive surprises could come from a recovery later in the year in commercial refrigeration, heat pumps and the implementation of a rich data center portfolio.
The broker has incorporated a weaker scenario in FY24, reducing year-over-year revenue growth to 3% and optimizing EBITDA margin to 12.9%. It introduced guidance for FY25, with long-term revenue growth of 7.5% year-over-year and EBITDA margin expanding by 20 basis points over FY24.
Intermonte confirmed the target price to 28 euros for action and the recommendation on the title to “Outperform“. The analysts confirmed the revenue and EBITDA estimates, already consistent with management’s indications. Below this line, they reduced D&A, as a consequence of a slightly lower CapEx, while financial charges have increased slightly (90% of loans are at a fixed rate, on average around 3%). Looking exclusively to 2023, they took into account a lower tax rate, thanks to some tax benefits in Poland and a more favorable geographic mix. Overall, they have increased EPS forecasts for 2023 and 2024 by 4.3% and 0.7% respectively.
“The resilience of margins in the third quarter of 2023 confirmed theexcellent management control they obvious benefits deriving from business differentiation – we read in the research – Volatility in the heat pump sector does not affect the long-term prospects of the sector, which remains safe and promising. In detail, the group remains well exposed to favorable trends: 1) the application of increasingly severe environmental regulations; 2) the migration of heating systems from gas to electric through the use of heat pumps; 3) the development of the needs for refrigeration tools related to the increase in the urban population; 4) the creation of effective cold chains in developing countries; 5) cooling needs of data centers and renewable electricity generation plants”.