Euroapi: Oddo halves target price

(CercleFinance.com) - Euroapi announced that it will cease production of all APIs at its Brindisi site, as quality control failures have been identified and are being thoroughly investigated.


Following this announcement, Oddo BHF confirms its Underperform rating on the share, slashing its target price for it from E6 to E2.9 (Friday's cp: -17.5% at E2.7).

The duration of this shutdown is not yet known, but management has undertaken to provide the market with a little more visibility in Q2, Oddo BHF says.

Euroapi is suspending its 2024 guidance, i.e. sales declining by between -4 and -7% and a core EBITDA margin of between 6% and 9%.

We have therefore decided to adjust our estimates downwards by deducting E52m from our sales forecast (only 2 months of sales over the full year of the site, taking 2023 into account), which results in an 11% drop in sales (compared with -6% init) for a margin now of 5.9% (compared with 7.9% init), Oddo BHF says.


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