First Berlin Equity Research has published a research update on Schloss Wachenheim AG (ISIN: DE0007229007). Analyst Simon Scholes reiterated his BUY rating and increased the price target from EUR 21.00 to EUR 22.00.
Q3 22/23 sales rose 16.5% to €82.5m (Q3 21/22: €70.9m) and were 10.1% above our €74.9m forecast. EBIT was in the black at €0.9m (Q3 21/22: €-0.1m) compared with our expectation of a small loss. The better than expected performance was driven by the resilience of volume growth (+1.9%) in the face of price rises which Schloss Wachenheim was forced to implement to cover higher raw material and energy costs. Management have raised full-year guidance (June year-end) and now expect a 10% rise in sales (previously: a slight rise) and EBIT of €25m – €27m (previously: €20.5m – €22.5m). We have raised our own forecasts and now see fair value for the share at €22.00 (previously: €21.00). We maintain our Buy recommendation.
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