Eramet falls after revising its 2024 targets

(CercleFinance.com) - Eramet's share price was down almost -14% at the end of the day, following a revision of its targets.


Eramet has lowered its 2024 targets for Comilog and PT Weda Bay Nickel, in view of the deteriorated market conditions for carbon steel in China and the issuance by Indonesia of a lower-than-expected nickel ore sales permit.

Oddo BHF reaffirms its 'outperform' rating on Eramet, with a price target lowered from €126 to €109, in the wake of a significant reduction in production targets for its manganese ore activities in Gabon and its nickel activities at Weda Bay.

This decision reflects a pronounced imbalance between sluggish demand from the Chinese steel sector and oversupply following the explosion in prices over the summer", explains the analyst, who reduces his expectations for adjusted EBITDA 2024.

Despite the current air pocket, we remain positive on the Group, which has assets that are all well positioned on the cost curve and good prospects for production expansion in the short and medium term", he nevertheless judges.

While maintaining its 'buy' recommendation on Eramet, BofA Global Research has lowered its price target from 120 to 110 euros, after the Group reduced its 2024 targets for Comilog (manganese ore) and PT Weda Bay (nickel ore).

With these new volume forecasts coming in below the broker's expectations, he is updating his model for the mining and metallurgical company, with a 24% reduction in EBITDA expected for 2024, to €678 million.

'The downgraded forecasts are disappointing, but we think the share has already moved as a result of the downgraded outlook for Chinese steel and manganese ore prices', he believes.

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