On Monday, Stifel adjusted its stance on shares of Clariant AG (SIX:CLN:SW) (OTC: CLZNY), upgrading the company's stock from Hold to Buy and increasing the price target to CHF16.20, up from the previous CHF12.60. The upgrade comes as Clariant's Care Chemicals division has demonstrated solid growth for the fourth consecutive quarter, and its Additives business is at what Stifel considers an inflection point.
According to Stifel, the improved visibility on Clariant's earnings sets it apart from other value stocks. The firm anticipates that Clariant's management will shed light on the catalyst order book in the second half of the year, which is expected to reinforce the recovery of this segment by the fiscal year 2025.
Stifel's outlook is further buoyed by Clariant's potential for strong cash conversion, attributed to the company's modest capital expenditure needs and the conclusion of its restructuring initiatives. The only exception noted is the ongoing dismantling of the Sunliquid site in Romania.
The upgrade reflects a confidence in Clariant's financial health and its capacity to generate shareholder value, as indicated by the company's performance trends and strategic moves. Clariant has not yet provided public comments regarding Stifel's upgraded rating and revised price target.
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