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On Wednesday, Deutsche Bank (ETR:DBKGn)'s analysts adjusted the price target for XP (NASDAQ:XP) Power (XPP:LN) (OTC: XPPLF), reducing it to GBP13.25 from GBP13.40, while maintaining a Hold rating on the stock.
The analysts said " XP Power's Q4 and Full Year trading update signalled lower Q4 24 revenue generation and order intake than implied by our forecasts, combined with better than anticipated cash generation for 2024."
XP Power's performance in the last quarter led to a revised expectation for the 2024 operating profit, which is now projected to be within the range of analysts' expectations, between GBP25.1 million and GBP27.4 million.
This is in line with the broader market's forecasts, rather than Deutsche Bank's previous estimate of GBP27.0 million.
Despite the softer revenue figures, the company's operational cash flow was stronger than forecasted, resulting in a year-end net debt of GBP93.5 million.
This equates to a net debt to EBITDA (N/EBITDA) ratio of approximately 2.3 times, slightly better than the 2.4 times previously projected by Deutsche Bank.
The stock's last closing price was recorded at GBP12.40. With the new price target set at GBP13.25, Deutsche Bank signals a modest upside potential for investors while still recommending to hold the shares.
The change in price target reflects the latest financial data and market conditions affecting XP Power, taking into account the company's end-of-year financial position and its ability to generate cash in a challenging quarter.
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