Is this U.S.-China selloff a buy? A top Wall Street voice weighs in
Investing.com - Goldman Sachs has reiterated a Buy rating and EUR21.00 price target on Umicore SA (BR:UMI) (OTC:UMICY) following the company’s announcement of gold inventory sales.
Umicore has sold its permanently held gold inventories from both its Jewellery & Industrial Metals and Precious Metals refining divisions, a move that Goldman Sachs views positively for the company’s financial position.
The transaction has already reduced Umicore’s leverage to 1.8x Net Debt/LTM EBITDA from 2.3x in the first half of 2025, surpassing the company’s target of achieving below 2.0x by 2027. Umicore also expects to benefit from lower financial costs, as the company estimates lease payments should be less than its current financial expenses.
Goldman Sachs notes that this inventory monetization represents an unexpected positive development for investors, though it is one-off in nature. The firm maintains its Buy rating based on anticipated earnings growth in the second half of 2025, supported by favorable metal pricing and strong automotive production conditions.
The research firm also identifies a potential catalyst for significant share price appreciation in the possible de-risking of Umicore’s Battery Materials strategy through a partnership or sale arrangement.
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