Assa Abloy: Deutsche Bank raises target price

(CercleFinance.com) - Deutsche Bank announced on Thursday that it had raised its target price for Assa Abloy from SEK 290 to SEK 300, ahead of the publication of the Nordic locksmith giant's third-quarter results on 23 October.


The broker expects organic sales growth of 1% in the current quarter, with its EBIT margin improving by 50 points to 16.2%.

In its view, investors will be mainly looking for confirmation of a rebound in the US residential sector, following the strong growth posted by subsidiary HHI in Q2.

For the rest, non-residential activities (healthcare, industry, etc.) remain gloomy, he adds, pointing out that the ABI index, which measures billings by architectural firms in the US, fell for the 19th consecutive month in August.

With a share price up 7% over the past month, a P/E of 23.3x and an EV/Ebitda ratio, Deutsche Bank explains that it is maintaining its 'hold' recommendation and prefers to steer clear of the stock, preferring Legrand, which it recently upgraded to 'buy'.


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