’Reddit is built for this moment’ - Stock soars on crushed earnings
On Friday, HSBC analyst Sezgi Oezener upgraded Siemens (ETR:SIEGn) Healthineers stock from Hold to Buy, setting a new price target of EUR58.00, reduced from the previous EUR61.00. The upgrade reflects the analyst’s confidence in the company’s comprehensive offerings and growth prospects, which are believed to justify a premium valuation compared to its peers.
Siemens Healthineers is recognized for its substantial innovation within its product portfolio, particularly in imaging, advanced therapies (AT), and its Varian medical systems segment. The company’s diagnostics division is also on track for a successful turnaround, further reinforcing the positive outlook.
The growth expectations for Varian, which represents 17% of the group’s sales forecast for the fiscal year 2024, are significantly higher than for other segments of the business. Siemens Healthineers anticipates high single-digit growth from Varian in the medium term, compared to mid-single digit growth from its imaging segment. This differential is seen as a justification for a higher multiple in HSBC’s valuation.
Despite the recent underperformance of Siemens Healthineers stock compared to the FTSE healthcare index year-to-date, HSBC attributes this to concerns over a potential stake sale by the parent company. Nevertheless, the firm emphasizes Siemens Healthineers’ strong historical execution capabilities, including best-in-class supply chain management that has successfully navigated past tariff cycles and supply chain challenges post-pandemic.
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