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Investing.com - UBS initiated coverage on IONOS (ETR:IOS) with a Buy rating and a price target of EUR47.00 on Friday.
The investment bank believes IONOS is strategically positioned across European markets to serve as a comprehensive digitalization partner for small and medium-sized businesses (SMBs).
UBS noted that despite IONOS shares having rallied more than 80% due to increased liquidity, a first-quarter guidance upgrade, and association with AI stocks, significant upside potential remains.
The firm highlighted three key growth drivers: rapid scaling of cloud services benefiting from EU digital investments and digital sovereignty initiatives; potential for acquisitions or shareholder returns given the company’s approaching zero leverage; and continued solid growth with expanding margins in the core Web Presence and Productivity unit.
IONOS currently trades at 26 times projected 2025 earnings with an expected mid-term earnings per share compound annual growth rate of 20%, according to UBS’s analysis.
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