- German DAX slips ahead of NFP reading
- HelloFresh shares lose 42% after reporting lower-than-expected annual forecasts
Overall market situation:
This week's final session on international financial markets brings mixed investor sentiment. Most indices from the Old Continent are seeing intraday declines ahead of the publication of key NFP data from the US. It is the publication of this macro data that could weigh on further sentiment of Friday's session.
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European companies listed during Friday's trading session are currently trading at mixed levels. Source: xStation
The German benchmark DE40 is trading down nearly 0.4% during today's session. Thus, the index is coming off the zone of historical peaks that were broken out yesterday. However, it is worth bearing in mind that the currently visible deviation is not overly large. The most important zone of possible support may at present be the local zone of minima linked to the 50-period exponential moving average (blue curve, H4 interval). The zone of local maxima of the consolidation zone near 17920 points may be considered as local resistance at the moment. Source: xStation
News:
HelloFresh (HFG.DE) shares are down around 42% in today's session after the company announced that it will miss its previously set targets for 2025. Furthermore, the company set its profit target for 2024 well below analysts' forecasts. The company pointed to a decline in cooking kit orders and investments in increasing production capacity in its new ready meals segment. Analysts believe that these unexpected updates undermine the German company's business model and could further damage management's credibility, especially after another warning in November.
ANNUAL FORECASTS
- Adjusted EBITDA expected to be between €350 million and €400 million, estimated at €545.1 million
- Sales at constant exchange rates are expected to increase by 2% to 8%, estimate was +6.79%
COMMENTARY
- Preliminary revenue for 2023 was €7.60 billion
- Preliminary adjusted EBITDA for 2023 was €448 million
- "Unlikely" that the company will achieve its revenue target of €10 billion by 2025
- "Unlikely" that the company will achieve its adjusted EBITDA target of €1 billion by 2025
- Revenue growth in the first quarter of 2024 at a group level is expected to be similar to the revenue growth achieved in 2023, which is at the lower end of the 2024 target
- First quarter 2024 adjusted EBITDA margin at group level is expected to be around balance or slightly negative
The company's shares are currently trading at historical lows of 2019. The RSI indicator on the MN interval indicates an extreme oversold condition for the company. Source: xStation
Other news about individual companies included in the DAX index. Source: Bloomberg Financial LP
Analyst recommendations:
- SocGen downgraded the rating on shares of Brenntag (BNR.DE) to "hold" from its previous "buy" rating. Target price set at €90 per share.
- Hedgeye initiated analyst coverage for shares of Birkenstock (BIRK.US) with a "sell" rating.
- Stifel raised its recommendation on Encavis (ECV.DE) to a "hold" rating from its previous "sell" rating. The target price was set at €13.9.
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