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Investing.com - JPMorgan upgraded Sika AG (SIX:SIKA) (OTC:SKFOF) stock rating from Underweight to Neutral on Thursday, setting a price target of CHF186.00.
The upgrade comes after Sika’s year-to-date stock underperformance, according to the investment bank’s analysis.
JPMorgan noted that following Sika’s guidance downgrade at its H1 results, where the company now expects only a modest sales increase in local currencies versus a previously forecasted 3-6% increase, the earnings risk appears "well balanced" for 2025.
Despite the upgrade, JPMorgan indicated that Sika remains "one of our least preferred names" in the sector, citing concerns about the company’s valuation.
The investment bank highlighted three ongoing challenges for Sika: diminished outperformance versus Lightside peers following an earnings downgrade cycle, limited potential from volume recovery compared to sector peers, and an increasingly competitive landscape.
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