On Wednesday, Barclays (LON:BARC) analyst Maurice Patrick upgraded the rating for Elisa Oyj, a Finnish telecommunications company listed as ELISA:FH on the Helsinki stock exchange and as OTC: ELMUF in over-the-counter markets, from Underweight to Overweight. Alongside the improved rating, the price target for the company's shares was increased to €55.00, up from the previous target of €47.00.
The upgrade reflects a positive outlook on the Finnish telecommunications market, which Patrick highlighted as exhibiting high growth and robust returns on capital employed (ROCE). The analyst's commentary underscored the strength of the Finnish market compared to its European counterparts, citing a history of positive pricing power and rational competition that has fostered continued profitable growth.
According to Patrick's analysis, this trend is expected to persist into 2025, with projections of 5.0% growth in both service revenue and EBITDA (earnings before interest, taxes, depreciation, and amortization) for that year. The forecasts by Barclays are notably 1.6% higher than the adjusted EBITDA consensus for 2025 as reported by Bloomberg.
The new price target of €55 implies a 25% upside potential for Elisa Oyj's shares. The upgrade to Overweight indicates a bullish stance on the stock's future performance in the market, signaling confidence in the company's growth trajectory and its ability to outperform in the Finnish telecommunications sector.
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