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Investing.com - Jefferies upgraded Cancom SE (ETR:COK) from Hold to Buy on Thursday, while slightly lowering its price target to EUR29.00 from EUR30.00.
The German IT services provider has faced significant challenges over the past three years, including five profit warnings since 2022, with the most recent issued on July 31, 2025. These challenges have resulted in a two-thirds decline in market value and reduced visibility among international investors.
In response to these difficulties, Cancom’s management has implemented another cost-cutting program targeting approximately EUR12 million in annualized personnel savings. The company is also restructuring operations to improve operating leverage ahead of an anticipated German economic recovery.
Jefferies notes that among listed Value-Added Resellers (VARs), Cancom maintains the highest exposure to Germany’s small and medium-sized business sector. This segment has been particularly cautious with IT infrastructure investments due to elevated interest rates, political uncertainty, and macroeconomic headwinds.
Despite these challenges, Jefferies believes the latest guidance revision could mark a turning point for Cancom, with improvement expected in the second half of 2025 as public spending rebounds. The firm points to July exit rates that already suggest a positive shift in market sentiment.
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