Sartorius Stedim – Profit Warning Could Drive Rights Issue (SELL, TP EUR170 [180], 5 pgs)
On Friday, Sartorius Stedim Biotech issued a profit warning that we believe implies a 24% EBITDA downgrade to 2023 consensus. Moreover, 2023 net debt/EBITDA is now expected to be 0.6x higher & we question whether DIM FP will now have to do a rights issue to acquire Polyplus. We have been bearish on DIM FP since October 2022 when we cut to SELL & were already below company guidance for this year, but even we have had to cut our 2023 EBITDA forecast by ~20%. The reasons given for the profit warning go beyond inventories alone & we believe it supports our analysis that the current downturn for the smaller bioprocessor supplier players will be protracted & warrants multiple compression. PT cut to €170.For access to the full note, please contact Naresh Chouhan ( )
Sartorius Stedim Biotech is a provider of equipment and services for the development, quality assurance and production processes of the biopharmaceutical industry. Co.'s solutions cover fermentation, filtration, purification, fluid management and lab technologies and membrane chromatography, including various conventional lab products to biopharmaceutical laboratories. Co.'s technologies, products and services are used to develop and manufacture medications and vaccines using biological methods. Co.'s products covers all upstream and downstream steps in the production of active pharmaceutical ingredients. It specializes in single-use products and offers technical consulting and services.
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