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Cautious Optimism for GrafTech International: Navigating Risks and Opportunities with a Hold Rating

Cautious Optimism for GrafTech International: Navigating Risks and Opportunities with a Hold Rating

In a report released yesterday, Katja Jancic from BMO Capital maintained a Hold rating on GrafTech International (EAFResearch Report), with a price target of $1.50.

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Katja Jancic has given her Hold rating due to a combination of factors impacting GrafTech International’s current and future performance. The company’s sales outlook appears cautiously optimistic for 2025, with expectations of market share recovery and low-double-digit sales growth despite a challenging pricing environment. GrafTech’s efforts to increase prices and focus on cost reduction are positive, yet the uncertain acceptance of price hikes in a soft market introduces risk.
Additionally, potential tariff risks related to GrafTech’s operations in Mexico and Europe present uncertainties. While the company is evaluating possible responses to mitigate these risks, the effectiveness of such measures is uncertain. Finally, although GrafTech has sufficient liquidity to navigate present challenges, the weak demand and pricing conditions in the graphite electrode market limit immediate upside potential, justifying the Hold rating.

In another report released on February 7, RBC Capital also maintained a Hold rating on the stock with a $2.00 price target.

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