Figma Shares Indicated To Open $105/$110
On Friday, Bernstein SocGen Group updated its stance on Valeo SA (FR:FP) (OTC: OTC:VLEEY), increasing the price target to €13.00 from €10.00, while reaffirming an Outperform rating on the stock. The adjustment comes after Valeo (EPA:VLOF) disclosed its full-year 2024 results on February 27, which exceeded market expectations, particularly in operating profit and free cash flow (FCF). According to InvestingPro data, the company’s strong performance is reflected in its impressive 25% year-to-date return and robust financial health score.
Valeo’s FY24 financial performance demonstrated the company’s ability to surpass its free cash flow targets and resilience amid customer production disruptions. With annual revenue reaching $23.5 billion and maintaining profitable operations, the company has shown strong execution capabilities. The management’s commentary also highlighted Valeo’s preparedness to capitalize on market growth opportunities. The results, including the operating profit and FCF, surpassed consensus forecasts, and the company’s 2025 guidance midpoint is now higher than the compiled consensus.
Bernstein’s last valuation update for Valeo was on November 20, 2024, where the peer average multiples for enterprise value to earnings before interest and taxes (EV/EBIT) and price to earnings (P/E) were at 7.1x and 6.6x, respectively. These multiples have since increased significantly to 7.8x and 7.5x. Applying these revised multiples to Valeo’s updated estimates led to the elevation of the price target. InvestingPro analysis reveals the stock currently trades at a P/E of 9.86x and an attractive EV/EBITDA of 3.74x. Subscribers can access 8 additional key valuation metrics and insights.
Valeo’s recent financial report and the subsequent price target increase reflect the company’s solid performance and promising outlook. The automotive supplier’s achievements in FY24 and the optimistic guidance for the coming year have contributed to a more favorable assessment of its stock value by Bernstein. InvestingPro’s Fair Value analysis suggests the stock is currently undervalued, supporting Bernstein’s bullish stance.
In other recent news, Citi analysts have updated their financial model for Valeo SA , resulting in an increased price target from €9.30 to €10.80. This adjustment is based on changes in global auto production schedules and other key factors. Despite the positive adjustments, Valeo’s stock rating remains at Neutral, with a High Risk designation. The analysts anticipate that Valeo will meet its revenue and EBIT guidance for the fiscal year 2024, following a previous reduction in sales guidance with the third-quarter results. Valeo’s focus on cost control and quality improvements is expected to enhance EBIT margins by 50 basis points in the latter half of 2024, with similar progress expected in 2025. The company’s financial outlook is bolstered by improved profitability in its backlog and a reduction in the capitalization of research and development expenses. Citi’s revised forecasts for Valeo show minimal changes for 2024, but slightly lower expectations for 2025 and 2026 due to reduced margin uplift assumptions and increased financial expenses. The projection for free cash flow remains largely unchanged, with a more favorable long-term estimation factored into the new price target.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.