In a report released today, Michael Ryskin from Bank of America Securities maintained a Buy rating on Stevanato Group (STVN – Research Report), with a price target of $26.00.
Michael Ryskin has given his Buy rating due to a combination of factors that highlight Stevanato Group’s potential for growth and resilience in the face of current challenges. The company’s guidance for fiscal year 2025, which includes a 6.5% constant currency growth and an adjusted EBITDA of €300 million, aligns with expectations and suggests a positive outlook. The anticipated ramp-up in syringe capacity and improvements in the vial market, along with a resurgence in the Engineering segment, are expected to drive sequential growth throughout the year.
Additionally, the destocking issue that impacted vial sales in fiscal year 2024 is expected to dissipate, with normalized order patterns already observed from major customers. The Engineering segment is addressing previous challenges and is poised for high single-digit growth as demand increases due to regulatory shifts. Furthermore, the company’s strategic capital expenditure plans aim to expand capacity and capture market share in the sterile cartridge sector, positioning Stevanato Group favorably for future growth. Despite a temporary negative free cash flow in fiscal year 2025, the normalization of capital expenditures in fiscal year 2026 is expected to turn free cash flow positive, reinforcing the company’s long-term financial health.
In another report released on March 6, Citi also reiterated a Buy rating on the stock with a $28.00 price target.
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