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On Wednesday, JPMorgan analyst Detlef Winckelmann upgraded Mondi (LON:MNDI) PLC shares from Neutral to Overweight. The new price target is set at £14.30, slightly adjusted from the previous £14.35. Winckelmann’s assessment indicates a positive outlook for the paper and packaging company, citing several factors that could benefit Mondi’s market position and financial performance.
The upgrade is based on a combination of elements that suggest limited downside risk and potential for growth. These include the analyst’s view that containerboard markets are showing limited downside risk and kraft paper markets present upside risks. Additionally, the analyst notes that consensus estimates for Mondi have become more reasonable, which may indicate the end of a cycle of earnings downgrades.
Winckelmann believes that Mondi’s through-the-cycle (TTC) earnings are approximately 60% ahead of the 2024 EBITDA forecasts. This positions the company to potentially unlock significant value for medium-to-long-term investors, with the TTC target price suggesting a 70% upside. The upgrade also reflects confidence in the company’s valuation multiples, which are deemed more reliable following the stabilization of earnings estimates.
The new price target of £14.30 per share implies an approximate 20% upside from current levels. This target is based on the exchange rate provided by the analyst and is set with a December 2026 horizon in mind. Mondi PLC, listed on the London Stock Exchange (LON:LSEG) as MNDI:LN and traded over-the-counter as MONDY, is expected to benefit from these favorable conditions as per JPMorgan’s analysis.
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