First Berlin – PSI AG Research Update (05/11/2018)

First Berlin Equity Research has published a research update on PSI AG (ISIN: DE000A0Z1JH9). Analyst Simon Scholes reiterated his ADD rating and increased the price target from EUR 18.00 to EUR 19.00.

PSI's Q3/18 order intake rose 13.9% to €41m (Q3/17: €36m) and was up 19.7% after nine months at a record €176m (9M/17: €147m). These numbers were helped by sales of new products in growth areas such as Industrie 4.0, intelligent integration of electromobility into local transmission networks, grid configuration for the future structure of electricity generation, and mathematical processes which simulate energy networks under sector coupling scenarios. Customer acceptance of these new products makes us optimistic that PSIs Vision 2022 of sales of €235m and a 10-13% EBIT margin can be achieved in full. We have raised our 2022 sales forecast to €235m (previously: €228.2m), while leaving our 2022 EBIT margin forecast unchanged at 10%. We now see fair value for the PSI share at €19.0 (previously: €18.0). We maintain our Add recommendation.