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Feb 14 2019, 12:05 GMT
DSM-Firmenich
Another year of strong delivery; announces €1bn share buyback
- Sectors : Foods
- Companies : DSM-Firmenich
DAVY VIEW
DSM’s rich vein of delivery has continued in 2018. However, despite sector-leading earnings growth, the stock has not meaningfully re-rated (EV/EBITDA basis) since 2015. An earlier-than-anticipated share buyback programme (€1bn) reflects the strength of DSM’s balance sheet – allied with a positive growth outlook, this may be a starting point for the equity to re-rate. DSM enters 2019 with good momentum (expects mid- to high- single-digit EBITDA growth) and retains ample financial capacity. We reiterate our ‘Outperform’ rating.
