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Investing.com - JPMorgan initiated coverage on Amrize Ltd (NYSE:AMRZ) with an Overweight rating and a $57.00 price target on Tuesday. The company, currently valued at $27.8 billion, has demonstrated strong profitability with $11.6 billion in revenue and $2.9 billion in EBITDA over the last twelve months. According to InvestingPro data, the stock is currently trading above its Fair Value.
The investment bank highlighted Amrize’s structure, which consists of two main segments: Building Materials accounting for 77% of EBITDA (including cement, aggregates, ready-mix concrete, and asphalt) and Building Envelope, which offers roofing systems and insulation. InvestingPro analysis shows the company maintains a healthy current ratio of 2.0, with liquid assets well exceeding short-term obligations.
JPMorgan cited Amrize’s robust EBITDA growth prospects, both organic and inorganic, along with a strong free cash flow conversion rate exceeding 50% as key factors making the stock an attractive investment opportunity. The company’s financial health score is rated as "GOOD" by InvestingPro, with particularly strong marks in profitability metrics.
The firm noted that despite expectations for flat revenue and EBITDA this year, Amrize is projected to achieve 9-12% EBITDA growth through 2028, with approximately $6 billion in leverage capacity available for acquisitions.
JPMorgan also pointed out that Amrize currently trades at 9.5x forward EV/EBITDA, a discount compared to peers, with potential catalysts including possible inclusion in multiple U.S. indices, a large accretive M&A transaction, and an aggressive share buyback program.
In other recent news, Amrize Ltd has been the focus of several analyst reports, highlighting various aspects of its financial and strategic position. Bernstein initiated coverage with an Outperform rating, citing Amrize’s strong market position and pricing power, and forecasting a 7.9% compound annual growth rate in sales from 2024 to 2028. Goldman Sachs gave Amrize a Neutral rating, noting its leading margins in the cement business and a strategic expansion in the roofing segment, but expressed concerns over slowing construction growth. Berenberg also initiated coverage with a Buy rating, based on a robust mid-term profit outlook and growth potential from acquisitions. BofA Securities provided a Neutral rating, pointing to strong fundamentals and significant merger and acquisition opportunities, though it noted uncertainties in the U.S. market volumes. Each firm has set varying price targets, with Bernstein at $62.00, Goldman Sachs at $57.00, Berenberg at $64.00, and BofA Securities at $56.00. These recent developments reflect diverse perspectives on Amrize’s future prospects and market position.
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