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Deutsche Bank (ETR:DBKGn) lowered its price target on Kuehne + Nagel International AG (SWX:KNIN) stock to CHF225.00 from CHF251.00 on Monday, while maintaining a Buy rating on the Swiss logistics company. The $26.57 billion market cap company, a prominent player in marine transportation, currently trades at a P/E ratio of 18x and has maintained dividend payments for 31 consecutive years, according to InvestingPro data.
The price target reduction reflects the impact of currency movements, particularly the USD/CHF exchange rate, as well as lower yields in the current market environment. Deutsche Bank noted that a 10% movement in the CHF/USD exchange rate could impact the company’s EBIT by approximately 4%. Despite these challenges, InvestingPro analysis suggests the company operates with moderate debt levels and maintains strong cash flows to cover interest payments.
The logistics giant’s sea freight division appears most vulnerable to foreign exchange impacts, with Deutsche Bank forecasting only 2% volume growth year-over-year for the second quarter. In contrast, the air freight division is expected to see 10% volume growth during the same period.
Deutsche Bank described the current trading environment as "extremely volatile" due to ongoing tariff news, which affects not only freight flows but broader business operations. The bank’s analysis incorporates Kuehne + Nagel’s recent US acquisition of IMC when calculating potential foreign exchange impacts.
Despite the reduced price target, Deutsche Bank’s maintained Buy rating suggests continued confidence in Kuehne + Nagel’s overall business prospects despite the challenging market conditions. The company has demonstrated resilience with 13.34% revenue growth over the last twelve months, and InvestingPro analysis indicates the stock is currently trading below its Fair Value, suggesting potential upside opportunity. Subscribers can access 5 additional exclusive ProTips and detailed financial metrics to make more informed investment decisions.
In other recent news, Deutsche Bank has maintained its Buy rating on Kuehne + Nagel International AG, with a consistent price target of CHF251. This decision follows insights shared by the company’s CFO, Markus Blanka-Graff, during a virtual group meeting. The CFO highlighted ongoing market uncertainties, noting a decline in clients’ production levels, although overall volume remains strong. A notable development is the geographical shift of some production to other Asian countries, which has resulted in increased booking numbers for the company. However, there is a cautious note regarding the fluctuation in weekly bookings, which have varied significantly. In the air freight sector, Kuehne + Nagel is reportedly benefiting from customers leveraging these services to adjust volumes quickly, yielding profitable returns. The CFO noted that the gross profit per ton in air freight remains stable, indicating steady performance in this segment. Deutsche Bank’s continued confidence in the company suggests that Kuehne + Nagel’s strategic adaptability is seen as a strength in navigating current economic challenges.
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