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On Thursday, Deutsche Bank (ETR:DBKGn)’s analysis led to a positive outlook for Evonik Industries AG (ETR:EVKn) (EVK:GR) (OTC: EVKIF), as the firm’s analyst Tim Jones increased the price target on the stock from EUR 21.00 to EUR 24.00 while maintaining a Buy rating. The adjustment comes in the wake of the company’s fiscal year 2024 earnings, which, despite being slightly below Deutsche Bank’s expectations due to one-time effects, did not dampen the analyst’s confidence in the company’s performance.
Evonik’s fiscal year 2024 EBITDA grew by 25% year-over-year, a metric that stands out against its competitors. The company’s full-year and first-quarter 2025 guidance suggests further growth, with projections exceeding the consensus and offering a stark contrast to its peers. This consistent outperformance, according to Jones, underscores the underappreciated quality of Evonik’s business segments, including Specialty Additives and Nutrition & Care.
The analyst also highlighted the company’s financial metrics, noting that Evonik trades at 6.7 times its estimated 2025 EV/EBITDA, which represents a 20% discount compared to its peer BASF. Additionally, Evonik boasts a 9% free cash flow yield and a 6% dividend yield, which could be attractive to investors.
The positive sentiment towards Europe and Germany, where Evonik has significant exposure, further enhances the company’s outlook. Germany alone accounted for 17% of Evonik’s 2024 sales and 40% of its non-current assets, positioning the group well within these markets.
In summary, Deutsche Bank’s revised price target for Evonik reflects a belief in the company’s strong fundamentals and potential for growth, supported by its financial performance and strategic market positioning.
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