AMAG confirmed at HOLD, TP EUR 41 - Model update: Minor forecast changes post Q3
Alongside the Q3 release AMAG has expectedly raised its FY 21 EBITDA guidance to EUR175-195 mn from EUR 155-175 mn. Having sat already above the former top end, we have slightly increased forecasts.In general, we have adopted a more upbeat view on the upstream operations (more promising aluminium price fundamentals), whereas cost inflation has made us more conservative on the downstream part
While price-cost spreads for primary aluminium should have peaked in Q3, the outlook of sustained high prices (above all supply side driven) bodes well for Metal earnings going forward despite the recent pick-up of input costs
Demand for downstream products remains strong but AMAG noted that rising costs (energy, alloys, logistics) will have an increasing impact on downstream margins
We maintan the TP of EUR 41 and stick to the HOLD rating
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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