13 January 2012 11:49 [Source: ICIS news]
LONDON (ICIS)--Global analyst Bernstein Research on Friday maintained its "outperform" rating for Dutch specialty chemicals producer AkzoNobel, on the basis that paints and coatings prices are continuing to rise while input costs are slowing.
The analyst said this dynamic has created the potential for margin expansion in 2012 even in a weak volume-growth environment.
Bernstein also retained a target share price of €50 ($64) for AkzoNobel."Pricing has increased through 2011 in both the US and Europe," it said.
"Our commodity cost basket for paints and coatings, meanwhile, stabilised [in the second quarter of 2011] and has since largely been flat to negative sequentially. However, pricing has not fully offset cost inflation," Bernstein added.
"We estimate specialty chemicals costs have also recently declined sequentially along with petrochemicals," it said.
Meanwhile, Bernstein reduced its expectations for AkzoNobel’s fourth-quarter earnings, primarily on the back of one-off effects.In October, Bernstein said that AkzoNobel was slowly turning a corner on some key issues after stock reacted positively following third-quarter results.
($1 = €0.78)For more on AkzoNobel visit ICIS company intelligence.
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