Original-Research: R.

Original-Research: R. STAHL AG - from NuWays AG

Classification of NuWays AG to R. STAHL AG

Company Name: R. STAHL AG
ISIN: DE000A1PHBB5

Reason for the research: Update
Recommendation: Kaufen
from: 10.05.2024
Target price: EUR 29.00
Target price on sight of: 12 Monaten
Last rating change: 
Analyst: Christian Sandherr

Final Q1 out // Good start into 2024; chg. est.
 
Topic: R. Stahl reported a solid final Q1 underpinning the strong demand
for electrical explosion protection solutions, which should continue due to
favorable structural trends. Management confirmed FY24e guidance, which
looks well in reach (eNuW).
 
To recap, Q1 sales grew 8.5% yoy to EUR 84.7m, driven by a strong order
backlog of EUR 115m at the end of FY23. Further, while global supply chains
remained partially disrupted in the previous year, there were no
significant restrictions in Q1 FY24. Q1 adj. EBITDA decreased 19% to EUR 8.4m
with a lower but still solid margin of 9.9% (-3.4 pp) due to inflationary
effects from personnel costs, a higher material expense ratio and a EUR 2m
one-off from the implementation of the EXcelerate strategy program; 12.3%
adj. EBITDA margin excluding one-offs.
 
After a subdued order intake of EUR 74.5m in the fourth quarter, order intake
came in surprisingly positive at EUR 92.3m, only slightly below the
exceptionally strong order intake of last year's Q1 (EUR 96.7m). Driven by an
increasing stabilization of global supply chains, the order intake in Q4
2023 was negatively affected by active destocking activities from customers
in addition to a soft chemical industry in the DACH region. While demand in
the chemical industry remained muted, the LNG, and petrochemical industry
as well as the nuclear sector showed positive momentum during Q1. Due to
the strong order intake, order backlog increased 6% to a solid level of EUR
122m (end of FY23: EUR 115m).
 
Management confirmed its FY24e guidance with sales in the range of EUR 335 -
350m and adj. EBITDA between EUR 35 - 45m. Thanks to the good start into the
year and a solid order backlog, the guidance seems to be well in reach
(eNuW sales: EUR 347m; adj. EBITDA: EUR 39.7m). Even more importantly, R.
Stahl's mid-term prospects remain bright as the company strongly benefits
from (1) its superior market share along the LNG value chain (liquefaction
and shipping: 75%, natural gas production: 50% and regasification 25%), (2)
a rising need for production automation across offshore oil and gas rigs,
and production plants of several industries and (3) the ongoing nuclear
renaissance across Europe.
 
With that, R. Stahl is well positioned to gradually improve margins,
returns and cash flow generation. As shares are trading on only 5.9x
EV/EBITDA 2024e we confirm our BUY rating with an unchanged EUR 29 PT, based
on DCF.

You can download the research here:
http://www.more-ir.de/d/29655.pdf
For additional information visit our website
www.nuways-ag.com/research.

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
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
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