Solvay - Resilience and returns
• FY23 was strong on FCF, while the new FY24 EBITDA guidance comfortably meets our and consensus expectations. • Although soda-ash pricing may be down, the other products are showing resilient pricing and there could be room for a volume recovery in H2-24.• The attractive dividend of EUR 2.43 p/s stands out (10% yield). We reiterate our Buy, a EUR 31, based on our peer-group based target multiple of 5.7x and backed by DCF.Solvay is engaged in chemical and plastic businesses worldwide. Co. offers chemical products such as advanced materials, barium strontium, calcium chloride, caustic soda, chlorinated products, fluor, peroxygen products, polyglycerols, precipitated calcium carbonate, soda ash, and sodium bicarbonate. It also provides specialty polymers, such as Spire ultra polymers, Solviva biomaterials, and sulfone polymers. Co. structures its activities around five operating segments: Advanced Formulations, Advanced Materials, Performance Chemicals, Functional Polymers and Corporate & Business Services, each with its own specific business model and each comprised of Global Business Units (GBUs).
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