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On Wednesday, Deutsche Bank (ETR:DBKGn) analyst Virginie Boucher updated the financial model for K+S AG (SDF:GR) (OTC: KPLUY), leading to an increased price target on the stock to EUR11.00 from the previous EUR10.50. The stock, currently trading near its 52-week high of $8.95, has shown remarkable strength with a 48.67% return over the past six months. Despite the higher price target, the Sell rating on the company’s shares was maintained. According to InvestingPro analysis, the stock appears to be fairly valued at current levels.
The revision in the price target comes after K+S AG’s first-quarter results and is based on improved earnings forecasts for the years 2025 to 2027. Boucher’s analysis suggests an increase in the expected EBITDA (earnings before interest, taxes, depreciation, and amortization) by 5-6%, owing to anticipated higher selling prices, margins, and volumes. InvestingPro data shows the company’s current EBITDA stands at $548.42M, with a solid financial health score of 2.9 (GOOD), supported by strong liquidity metrics including a current ratio of 3.36.
For the year 2025, Deutsche Bank now predicts an EBITDA of €620 million for K+S AG, which is an 11% year-over-year increase. This forecast is 3% higher than the midpoint of the company’s own guidance range of €560-640 million and 4% above the Bloomberg consensus of €598 million. With a market capitalization of $3.05 billion, InvestingPro subscribers have access to 12 additional key insights about K+S AG’s valuation and growth prospects through the comprehensive Pro Research Report.
The updated model also includes expectations for the average Agriculture selling price and volume. The bank estimates that the average selling price (excluding traded volume) will reach €330 per ton, marking a 4.4% increase year-over-year from the first quarter of 2025’s €325 per ton. Additionally, the volume (excluding trading) is projected to grow by 2% year-over-year to 7.7 million tons, which is slightly above the company’s guidance range of 7.5 to 7.7 million tons. These projections align with InvestingPro’s forecast of continued net income growth for the current year.
The adjustment in the price target reflects Deutsche Bank’s latest projections based on the company’s recent performance and market conditions. Despite the positive outlook on K+S AG’s financials, the Sell rating indicates that the bank’s analysts might still see challenges or limited upside potential for the stock at its current price level.
In other recent news, K+S AG reported a slight increase in its first-quarter 2025 earnings before interest, taxes, depreciation, and amortization (EBITDA), which rose by 0.2% to EUR200.6 million. This occurred despite a decline in revenue in the Agriculture and Industry+ segments. CFRA upgraded K+S’s stock rating from Strong Sell to Hold, raising the price target to EUR16.00, citing higher potash prices and an upward revision in EBITDA guidance for 2025. Conversely, Deutsche Bank maintained a Sell rating but increased the price target to EUR10.50, noting a nuanced outlook with a projected 7.5% decrease in first-quarter EBITDA to EUR185 million. Deutsche Bank’s analysts revised their 2025 EBITDA forecast upwards by 5% to EUR590 million, driven by lower energy costs and higher potash prices. Despite these positive adjustments, K+S’s free cash flow saw a significant decline, impacting dividend payouts. CFRA previously downgraded K+S to Strong Sell, maintaining a price target of EUR10.00, reflecting concerns over fertilizer price volatility amid geopolitical uncertainties. The ongoing market conditions have led to varied analyst projections and price targets for K+S AG.
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