Struggling shares - Anticipated SDAX performance projections
Nagarro (WKN: A3H220), a German tech company, has been temporarily excluded from the SDAX index due to a delay in publishing its annual figures and business report for 2024. This delay is a result of the need for additional time to complete the preparation and audit process for the annual accounts and management report.
The SDAX, which tracks smaller German companies, requires timely publication of financial information to ensure transparency and market fairness. When a company misses these reporting deadlines, it is standard procedure for the index administrators to temporarily exclude it until the necessary reports are published and verification is complete.
This measure protects investors by ensuring that all index constituents meet the disclosure requirements and that the index accurately reflects companies with available and current financial data. In Nagarro's case, the delay in publishing its 2024 annual figures and business report is the reason for the expected temporary exclusion from the SDAX.
The performance of Nagarro's stock in the SDAX index has been poor this year, with no other stocks performing worse. Since the beginning of the year, Nagarro's stock has lost more than 15 percent, making it one of the ten worst performers in the SDAX index. Formycon has performed the worst among these, with a loss of 56.6 percent.
Investors are advised to stay on the sidelines with regards to Nagarro's stock, as the ongoing threat of exclusion from the SDAX is likely to continue to weigh on the company's stock. However, Nagarro expects no impact on the 2024 balance sheet, and the changes in accounting will affect the income statement for 2023 but not the adjusted EBITDA (earnings before interest, taxes, and depreciation) for this year.
The company reaffirmed its forecasts for the past year, but the particular complexities in revenue recognition issues regarding the period-specific separation of revenue could open up new downside potential for Nagarro's stock, should these issues not be resolved satisfactorily. Despite the current challenges, Nagarro aims to continue paying a dividend of between 10 and 20 percent of EBIT (earnings before interest and taxes) to shareholders.
The year-to-date low for Nagarro's stock is at 62.60 euros, and the stock is in a well-established short-term downtrend. It is important to note that Nagarro is currently not covered by AKTIONÄR's recommendations. As the situation develops, investors will be keenly watching Nagarro's progress and any updates regarding the publication of its annual figures and business report for 2024.
- The temporary exclusion of Nagarro from the SDAX, which requires timely publication of financial information for business transparency and market fairness, could impact its stock-market performance.
- The delay in publishing Nagarro's annual figures and business report for 2024, causing the temporary exclusion from the SDAX, may affect investors' decisions regarding investing in the company's stocks.
