Original-Research: R. Stahl AG (von NuWays AG): Buy

Classification of NuWays AG to R. Stahl AG

Company Name:	R. Stahl AG
ISIN:	DE000A1PHBB5
Reason for the research:	Update
Recommendation:	Buy
from:	08.01.2025
Target price:	EUR 25.00
Target price on sight of:	12 months
Last rating change:
Analyst:	Christian Sandherr

Mixed FY25e outlook due to low order books

Topic: After a convincing FY24e, we see another solid year for R. Stahl ahead. However, due to a low order book and an uninspiring demand in Q3, sales and earnings could potentially be soft in H1’25e.

R. Stahl started with a solid order intake of € 181m (book-to-bill 1.04x) into the first half of FY24e before demand came down to € 74m in Q3 (book-to-bill 0.85x). A major reason is the still struggling European chemical industry where investments remain on a historically low level. In addition, larger decisions were delayed during the months before the presidential election in the US. Nevertheless, there should be a catch-up effect in Q4’24e and Q1’25e. Beyond that, president-elect Trump is expected to be a positive driver for the oil and gas industry.

While sales in Q3 still benefited from a sound backlog in the oil and gas industry in Americas, the order book has come down considerably to € 108m end of 9M’24 (vs. € 132m 9M’23). Consequently, we expect to see sales coming down for Q4’24e (eNuW: € 83m). Further, due to the lower visibility, H1’25e is now more dependent on new order intake in Q4’24 and H1’25e. For FY25e, we expect sales to slightly increase to € 355m, despite a potentially weaker H1.

We also expect the adj. EBITDA margin to improve slightly (eNuW: 10.8%), thanks to the EXcelerate strategy program. The implementation of the program created one-time costs of c. € 3.7m in 9M’24 (c. € 4.5m in total until 9M’24) and should amortize within 1-2 years as stated in the Q3 CC. On the other hand, pressure from wage inflation should persist throughout FY25e, although we expect the overall headcount to slightly decrease. Adj. EBITDA is seen to stay at a solid level of € 38m (eNuW).

Even though the upcoming quarters might be challenging, we continue to be optimistic in the mid- to long term. R. Stahl is not losing market share due to its positive brand recognition and it’s just a matter of time until the demand for R. Stahl’s explosion protection products recovers back.

We reiterate our BUY rating with an unchanged PT of € 25 based on DCF.

You can download the research here: http://www.more-ir.de/d/31591.pdf
For additional information visit our website: https://www.nuways-ag.com/research-feed

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
++++++++++
Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++