AMAG confirmed at HOLD, TP EUR 34.5 - Model update: Target price lifted on higher earnings
In the aftermath of good FY 20 results we confirm the HOLD rating and raise the target price to EUR 34.5 from EUR 26.5With full capacity utilisation at Alouette likely to be maintained, the development of the price-cost spread is the key determinant for earnings in the current year
In the downstream business demand is improving and there is reason to believe that mix is bottoming out
We have increased FY 21e EBITDA by 18% to approx. EUR 124 mn. The increase of our EBITDA estimate for FY 22e is more moderate (2% to EUR 139 mn)
Despite improved trading conditions, the stocks demanding valuation leaves the risk-reward profile in neutral territory, in our view
AMAG Austria Metall is a holding company, engaged in the production of primary aluminum, as well as cast and rolled aluminum products. The metal division is responsible for the risk management and steering of the metal flows. The casting division recycles aluminum scrap to produce foundry alloys. Its product portfolio covers aluminum materials tailored to customer requirements in the form of ingots, sows and liquid aluminum. The rolling division is responsible for the production and sale of rolled products, and precision cast and rolled plates. The service division include facility management, energy supplies, waste disposal, and purchasing and materials management.
The Institutional Equity Research team of Raiffeisen Bank International AG covers 85 stocks from Austria, Central & Eastern Europe with sell-side research and thus levers our local broker status with excellent company relationships. For corporates in Austria, CEE and Western Europe, we offer co-sponsored research, which includes research coverage and marketing activities to investors. Additionally, through our Spotlight Research product we also shed light on leading European small and micro-caps, seeking greater visibility with investors.
The Institutional Equity Research team consists of roughly 15 analysts, both in Vienna and the CEE countries. Our analysts provide long-standing sector expertise in tandem with profound local market know how and a sectoral approach across the entire region.
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