On Thursday, JPMorgan issued a new rating for Elisa Oyj (ELISA:FH) (OTC: ELMUF), downgrading the stock from Overweight to Neutral and adjusting the price target to EUR50.00 from the previous EUR55.00. The revision follows observations of softer underlying growth within the Finnish mobile market throughout 2024, with expectations for this trend to continue into 2025.
The analyst from JPMorgan highlighted that while there is still positive growth stemming from 5G upselling and 4G pricing, the 4G market segment is notably competitive. This competition is expected to impact Elisa Oyj's business performance. Furthermore, challenges in the business-to-business (B2B) sector are anticipated as Telenor intensifies efforts to capture more market share.
In light of these market conditions, JPMorgan has reduced its estimates for Elisa Oyj's financial performance in 2025. The firm's new projections are slightly more pessimistic than the consensus, with revenue estimates now 0.2% below consensus, EBITDA 0.5% lower, and Operating Free Cash Flow (OpFCF) 1.2% beneath the general market expectations.
This adjustment signals a cautious stance from JPMorgan regarding Elisa Oyj's near-term financial outlook amid a competitive and challenging market environment. The new price target of EUR50.00 reflects these revised expectations for the company's financial metrics and market position in the coming year.
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