Analyst Tejas Savant of Morgan Stanley maintained a Hold rating on Stevanato Group (STVN – Research Report), retaining the price target of $23.00.
Tejas Savant’s rating is based on several key considerations. The Stevanato Group’s recent financial performance showed a modest improvement, particularly in the fourth quarter, where revenue exceeded expectations due to strong sales in high-value syringes. However, this was offset by a significant decline in revenue from bulk and EZ-fill vials, which has been a persistent issue. The company’s ongoing capacity expansion efforts, particularly at their Fishers and Latina facilities, are expected to weigh on margins in the near term, although they are crucial for medium-term growth.
Despite some positive developments, such as progress in cost optimization, the overall outlook remains cautious. The anticipated recovery in vial destocking and engineering turnaround is gradual, and the company’s guidance for 2025 appears reasonable but not overly optimistic. These factors contribute to the decision to maintain a Hold rating, as there is limited potential for significant upside in estimates in the immediate future.
In another report released today, UBS also maintained a Hold rating on the stock with a $23.50 price target.