On Thursday, Kepler Cheuvreux initiated coverage on Wacker Chemie (ETR:WCHG) AG (WCH:GR) (OTC: WKCMF), giving the stock a Buy rating and setting a price target of €104.00. The research firm’s analyst cited the company’s significant transformation since its initial public offering in 2006, highlighting its strategic shift away from its Siltronic asset and the solar market’s polysilicon production towards strengthening its silicones and polymers businesses.
The analyst pointed out that recent discussions about tariffs and a period of slower demand have negatively impacted Wacker Chemie’s share performance. Despite these challenges, Kepler Cheuvreux forecasts a resurgence in demand across key customer industries, including electronics, construction, and automotive. This anticipated demand revival is expected to contribute positively to the company’s future performance.
Wacker Chemie is also poised to benefit from Europe’s push to reestablish itself as a major industrial hub, accompanied by substantial infrastructure investments. The analyst believes that these factors will lead to improved profitability for Wacker Chemie, which is currently not reflected in the company’s share valuation levels.
The firm emphasizes that finding a specialty chemicals asset with global leadership in key product lines at an attractive valuation is a rare opportunity. According to the analyst, Wacker Chemie represents such an opportunity, given its strong market position and the potential for increased demand in its customer industries. The positive outlook from Kepler Cheuvreux suggests confidence in Wacker Chemie’s strategic direction and its ability to capitalize on emerging market trends.
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