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Investing.com -- Deutsche Bank (ETR:DBKGn) has downgraded Wacker Chemie (ETR:WCHG) to “hold” from “buy,” citing mounting short-term risks tied to earnings momentum and the solar segment.
The price target was lowered to €57 from €74, following the stock’s last close at €59.90.
The brokerage flagged multiple concerns in the note, including downward revisions to earnings forecasts.
Deutsche Bank now estimates earnings for the second quarter, full-year 2025, and 2026 to come in 13%, 9%, and 11% below consensus, respectively.
The revisions are driven by foreign exchange impacts, weaker demand in solar markets, and broader macroeconomic softness.
The brokerage also flagged structural risks in the solar and polysilicon businesses. The sector faces pressure from a reduction in tax credits, ongoing supply chain reshuffling, and the potential for new capacity coming online, all of which could weigh on pricing and margins.
From a valuation standpoint, Wacker is trading at 7x 2025 estimated EV/EBITDA, compared with 6.5x for diversified chemical peers.
Its estimated free cash flow yield of 6.0% for 2025 also lags the 7.2% seen across the peer group.
Deutsche Bank noted that the company does not appear especially cheap in relative terms and lacks near-term catalysts to drive upside.