In a report released today, David Farrell from Jefferies maintained a Hold rating on XP Power (XPP – Research Report), with a price target of p1,440.00.
David Farrell’s rating is based on a combination of factors including XP Power’s recent financial update and strategic decisions. The company announced a £42 million equity raise to strengthen its balance sheet, which comes shortly after a previous raise and indicates ongoing financial challenges. Additionally, XP Power’s guidance suggests that recovery is not expected in the first half of 2025, with results anticipated to be lower due to issues such as export license problems related to its Chinese semiconductor exposure and continued de-stocking.
Moreover, the company’s financial performance in FY24 showed a significant decline in revenue across its key markets, including semiconductors, industrial technology, and healthcare. This decline, coupled with the need for additional capital, suggests a cautious outlook. These elements contribute to the Hold rating, as they reflect uncertainty and potential risks that may affect the company’s ability to recover in the near term.