Polytec confirmed at BUY, TP EUR 7 - Dire trading conditions persist but can it get worse?
Polytec remains trapped in an adverse market environment of muted OEM production rates amid shortages of semiconductors/cable harnesses and other supply chain frictions, soaring input costs and the tenacious negotiations with its customers regarding reimbursementsComments by CEO Huemer during the conference call suggest that H2 trading conditions will not be very different from H1
We question if things can get worse. Earnings and sentiment on Polytec might be at a trough and the shares are priced for sustained value destruction. The stock is currently trading at roughly half of its book value
We lower the target price to EUR 7 from EUR 7.5 and stick to the BUY rating
Polytec is a globally operating corporation, based in Austria, focusing on the automotive and plastics industries. Co. is engaged in the development and manufacturing of high-quality plastic parts. In the automotive industry, Co. works as supplier of exterior and engine compartment components in the high-volume market segment as well as a supplier of original equipment and components for small and medium series. Co. is active as a full-service provider in the area of injection molding, as a specialist in fiber-reinforced plastic components, as a manufacturer of original accessory parts made from plastic and as a developer of tailor-made industrial solutions made of polyurethane.
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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