On Friday, an analyst from Stifel adjusted the rating for Belimo Holding AG (BEAN:SW) (OTC: BLHWF) stock, shifting from a Buy to a Hold stance, despite increasing the price target to CHF 530.00 from the previous CHF 460.00.
The revision reflects the analyst's view that the current stock price has already incorporated the company's growth and margin prospects following a significant share price increase.
Belimo Holding AG, known for its energy efficiency solutions, reported a robust first half of 2024 performance, with a 14% earnings per share (EPS) beat and a 9.7% year-over-year organic sales increase. This performance, coupled with a high 19.6% EBIT margin, led to the company raising its sales growth guidance for the year.
In response to these results, Stifel revised its forecasts for Belimo's sales and EBIT for the fiscal years 2024 to 2026. The firm's new estimates suggest an average sales increase of 2.4% and an 8.5% rise in EBIT, targeting an EBIT margin above the generally conservative 16-18% corridor.
The analyst noted that the rating downgrade is a result of the substantial 20% rise in Belimo's share price since the half-year report was released on July 22.
This increase significantly outperformed the index's 1% gain during the same period. Despite the downgrade, the analyst acknowledged the ongoing positive outlook for Belimo as a beneficiary in the energy efficiency sector.
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