Nexity: Oddo BHF still on hold, reduces TP

(CercleFinance.com) - Going over Nexity's 2023 results and outlook, Oddo BHF confirms its 'neutral' rating on the stock, while reducing its target price for it from E15 to E12.


2023 OP came in at E246m, down 33%, mainly due to a lower contribution from residential property (Underlying OP E140m; -50%; OM 4.8% vs. 8.3%); as a result of higher construction costs, a less favourable customer mix and lower amortisation of fixed costs, the broker justifies.

Oddo BHF adds that profitability in the residential property sector is likely to continue to erode in an unfavourable environment.

The analyst therefore considers the current environment to be unquestionably very complicated, with a further decline in profitability forecast for 2024.

As a result, Oddo BHF has reduced its Underlying OP estimate by 30%, and believes that while FCF is likely to be loss-making, the disposal of the property administration business (and even the distribution business), will provide financial flexibility to adapt to new market conditions.


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