Gold prices steady ahead of Fed decision; weekly weakness noted
On Tuesday, Citi analyst Vivek Midha increased the price target on Knorr-Bremse AG (KBX:GR) to €98.00, up from the previous €89.00, while maintaining a Buy rating on the stock. The adjustment follows the review of Knorr-Bremse’s fourth-quarter results for 2024.
Midha’s analysis suggests that, although Knorr-Bremse’s stock has seen a notable ascent over the past month, it remains attractively priced at 11 times its projected 2026 enterprise value to earnings before interest, taxes, and amortization (EV/EBITA). The analyst believes this valuation is compelling for a company that has demonstrated a return on capital employed (ROCE) exceeding 20%.
The recent rally in Knorr-Bremse shares is attributed to a combination of improved sentiment towards companies with exposure to the German market, as well as investor recognition of the company’s potential for margin growth. Midha emphasized that the 2026 margin target of over 14% should be seen as an interim goal, with expectations for further margin expansion in the future.
In his commentary, Midha highlighted Knorr-Bremse’s promising structural transformation narrative. The company is positioned to significantly enhance its performance in the years ahead, which supports the rationale behind the raised price target.
Citi’s reiteration of the Buy rating reflects confidence in Knorr-Bremse’s investment appeal and its trajectory towards continued improvement and value creation for shareholders.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.