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On Friday, Kepler Cheuvreux adjusted its price target for FLSmidth & Co A/S (FLS:DC) (OTC:FLIDF), reducing it to DKK 440 from DKK 460, while still recommending the stock as a Buy. The modification follows the company’s first-quarter earnings report for 2025 and its updated EBITA guidance for the full year. Additionally, the firm’s ongoing exclusive negotiations regarding its Cement division were taken into account.
The analyst at Kepler Cheuvreux, William Mackie, provided insights into the decision to adjust the price target, noting that the revised estimates for orders and revenues through 2025 to 2027 remain consistent with previous predictions. However, the adjusted EBITA expectations have been increased by 4% for 2025 and by 5% for the subsequent two years. This enhancement reflects a combination of factors, including a better product mix, increased revenue from services, and additional cost-saving measures.
Despite the lower price target, which represents a 4% decrease, Kepler Cheuvreux maintains a positive outlook on FLSmidth’s stock. The firm’s decision to retain a Buy rating is grounded in the anticipation of growing profitability and a favorable resolution to the divestment of the Cement division.
Mackie’s commentary emphasized the rationale behind the updated financial figures, stating, "After reviewing the FY outlook and the relatively lower visibility compared to other mining peers, we trim our TP by 4% to DKK440." He further justified the continued Buy rating by citing the potential for increased profitability and a successful outcome from the Cement division’s divestment discussions.
FLSmidth’s recent developments, including the Q1 2025 results and the upgraded FY EBITA guidance, have been pivotal in Kepler Cheuvreux’s assessment. The firm’s stance reflects a balanced view of the company’s financial prospects, taking into consideration both the operational achievements and the challenges in comparison to its mining industry counterparts.
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