On Monday, Barco NV (BAR:BB) (OTC: BCNAY) saw its price target lowered by Berenberg from €20.00 to €17.00, while the firm retained a Buy rating on the stock. The adjustment comes amid concerns over a weak first quarter and modest expectations for the second quarter. The analyst from Berenberg pointed out that Barco's achievement of its 2024 guidance is likely to hinge on a significant recovery in the second half of the year.
The company's first-quarter performance has been underwhelming, and the anticipation for the second quarter doesn't suggest substantial improvements. According to the analyst, the reliance on a stronger performance in the latter half of 2024 is necessary for Barco to meet its targets. New product launches and favorable comparisons to previous periods are expected to contribute to a potential rebound.
Berenberg has revised its estimates for Barco as a precautionary measure due to the current outlook. Despite the reduction in the price target and estimates, the analyst believes that the stock's valuation remains appealing. This perspective is supported by Barco's robust balance sheet, which may provide some reassurance to investors.
The firm's commentary highlights the challenges faced by Barco in the near term, but also suggests that there are factors that could aid in the company's recovery later in the year. The Buy rating indicates that, despite the recent adjustments, Berenberg continues to see a positive long-term outlook for the stock.
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