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Investing.com - Jefferies upgraded Vonovia SE (ETR:VNA) (OTC:VNNVF) stock rating from Hold to Buy and raised its price target to EUR31.50 from EUR30.00.
The upgrade reflects Jefferies’ view that Vonovia is reaching a potential turning point after a period of challenges related to high leverage, reliance on non-recurring activities, and discretionary reporting practices.
Jefferies noted that Vonovia has begun to benefit from rising property valuations, which will improve the company’s loan-to-value (LTV) metrics.
The firm believes the valuation reset and leverage metrics improvement may provide justification for investors to re-enter the stock.
Jefferies also highlighted that Vonovia offers investors exposure to Europe’s housing recovery with embedded optionality while providing exposure to the German fiscal stimulus package through a domestic company.
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