First Berlin – SFC Energy AG Research Update (20/05/2020)

First Berlin Equity Research has published a research update on SFC Energy AG (ISIN: DE0007568578). Analyst Dr. Karsten von Blumenthal downgraded the stock to REDUCE and maintained his EUR 9.40 price target.

Abstract
SFC Energy has reported Q1 figures and held a conference call. Sales were only 2% below the prior year figure and 9% above our forecast due to a very strong Clean Energy & Mobility segment result. EBIT and the net result were in line with our expectation. EBIT was down €413k at €-432k. The order backlog rose 16% y/y to €15.9m. This is a promising sign amid the unfolding recession. So far, SFC has not had any covid-19 cases. The company has been fully operational, and capacity utilisation has been high. Work flows have been adjusted to pandemic restrictions. Orders are coming in and product is being shipped. Given the very low oil price and the severe pandemic restrictions in many countries since March, we expect a very weak Q2. An updated DCF model still yields a €9.40 price target. Following the share price increase since the beginning of April we downgrade the stock from Add to Reduce.