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Investing.com - Citi downgraded Knorr-Bremse AG (ETR:KBX) stock rating to neutral from buy on Friday, while lowering its price target to €92.00 from €97.00, citing concerns about weak U.S. truck market data.
The German brake systems manufacturer faces potential headwinds in the second half of 2025, with Citi warning of a possible negative catalyst from narrowing fiscal year 2025 margin guidance to the lower half of the company’s target range.
Poor U.S. Class 8 truck orders make a second-half recovery in the truck segment unlikely, according to Citi’s analysis. While European markets are performing better, the firm doesn’t expect sufficient upside to offset weakness in the U.S. market.
Citi projects mid-single-digit downside to Knorr-Bremse’s 2025 adjusted EBIT, creating what it describes as negative risk/reward for shares in the second half of 2025. The benefits of the company’s longer-term self-improvement initiatives, particularly cost savings in its truck division, may not become visible again until 2026.
The investment bank has opened a negative catalyst watch ahead of Knorr-Bremse’s first-half results, with near-term truck market dynamics likely to be the primary factor influencing the stock over the next six months.
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