Berenberg lowers target price on Synthomer
By Iain Gilbert
Date: Wednesday 07 May 2025
(Sharecast News) - Analysts at Berenberg lowered their target price on chemicals Synthomer from 150.0p to 120.0p on Wednesday, stating the group was not yet divested of balance-sheet problems.
Berenberg said Synthomer had experienced "a tough few weeks" until its Q1 update on 1 May, with concerns regarding the impact of a trade war being followed by a mid-April credit-rating downgrade by Moody's and a selloff in its 2029 bonds.
"The trading update - in which cost savings and mix appear to have driven a yoy improvement in group EBITDA despite a softer volume performance in its coatings business - has since stabilised the shares, at least temporarily," said Berenberg, which has a 'hold' rating on the stock.
The German bank stated long-awaited divestment of its UK inorganic chemicals business William Blythe to private equity firm H2 Partners and its management team for £30.0m should allow for "modest de-levering" year-on-year in 2025.
However, Berenberg cautioned that trade headwinds meant that further divestments "appear unlikely" in the next two to three months and said consensus underlying earnings estimates were "still a touch high" for its tastes.
Reporting by Iain Gilbert at Sharecast.com
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