Deutsche Bank Analyst Maintains 'Buy' on BASF Despite China Challenges
Analyst Virginie Boucher-Ferte from Deutsche Bank Research has maintained a 'Buy' rating for BASF stock despite recent challenges. She expects the company's annual targets to be confirmed, with a price target of 50.00 euros. However, she also anticipates a temporary setback in the third quarter due to economic conditions in the US economy.
Boucher-Ferte's concerns are rooted in the Chinese real estate crisis and trade conflicts with the USA, which are burdening the Chinese economy. The purchasing managers' index (PMI) for China's manufacturing sector contracted in September, reflecting these challenges. She expects BASF's operating profit (EBITDA) to decline by eight percent in the third quarter as a result.
Looking ahead, Boucher-Ferte expects 2025 to be a 'business trough' for BASF. Despite this, she believes the company is favorably valued in historical comparison and has good long-term prospects. The Communist Party's target of around five percent economic growth for 2023, and the upcoming discussion of the next five-year plan at the Fourth Plenum on October 20th, may also influence BASF's future performance.
Analyst Virginie Boucher-Ferte's 'Buy' rating for BASF stock suggests long-term confidence in the company, despite expecting a temporary decline in profits due to the US economy's situation. BASF's valuation and long-term prospects remain positive, with the company's future closely tied to the US economy's performance.
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