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Investing.com -- Shares of Italian Sea Group fell 7% on Wednesday after Kepler downgraded the company to Reduce from Buy, citing a prolonged lack of major orders.
The brokerage noted that the company has experienced six consecutive quarters without significant new orders, a trend that is expected to negatively impact financial performance in 2025 and 2026.
Kepler analysts significantly reduced their price target to €3.7 from €6.9, reflecting concerns about the company’s outlook.
The downgrade includes cuts to revenue and EBITDA forecasts by 12% and 24% respectively for fiscal year 2025, and by 15% and 31% for fiscal year 2026.
Analysts also raised their working capital to sales ratio projection to above 30% from 10% by year-end 2025.
According to Kepler, Italian Sea Group may need to accept lower profit margins to secure new contracts amid the ongoing order drought.
The brokerage indicated that a substantial turnaround in order intake would be necessary before they could adopt a more positive stance on the company.
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