Capgemini: biggest rise on the CAC, BofA upgrades to buy

(CercleFinance.com) - On Tuesday, Capgemini shares posted the biggest rise on the CAC 40 and the second-best performance on the STOXX Europe 600 index, thanks to a change of recommendation by Bank of America.


In a research note, the intermediary considers that the risks it identified in June, namely a possible downward revision of the group's targets, have now passed, following the profit warning issued in July.

In its view, the prospect of growth of between -1.6% and +3.6% for 2024/2025 seems much more realistic than the 0.7%/+6.7% forecast envisaged at the time.

BofA adds that the share's valuation has, in the meantime, returned to much more attractive levels in comparison with the sector's main comparables, having fallen to multi-year lows.

In the long term, the analyst continues to appreciate the French group's positioning in the digital transformation and generative AI markets.

He adds that current trends in the IT services and enterprise software sectors, as well as the evolution of global PMIs, point to a recovery in activity.

Against this backdrop, the professional has raised its recommendation on the stock from 'neutral' to 'buy', with a price target raised from 209 to 250 euros, revealing a potential upside of 38%.

Shortly before 4:00 pm, Capgemini shares were up by almost 0.7%, compared with a 0.1% decline for the CAC 40, bringing the share's performance since the start of the year back into the green (+1.1%).

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