UBS raises its target share price for Germany’s LANXESS

03 April 2012 12:44  [Source: ICIS news]

LONDON (ICIS)--UBS has raised its target share price for Germany-based LANXESS to €65 from €46 on higher expected earnings, the investment bank said on Tuesday.

Rising butadiene (BD) prices are expected to support the earnings before interest, tax, depreciation and amortisation (EBITDA) margins of LANXESS’s Performance Polymers division, UBS said. It raised the specialty chemical group’s forecast EBITDA by 10.1%, 8.9% and 10.4% for 2012-14 respectively.

LANXESS’s share rating was kept unchanged at “neutral”.

On 30 March, investment bank JP Morgan Cazenove more than doubled LANXESS’s share price target to €90 ($120) from €40, because of a positive outlook in its business segments and an expected strong first quarter.

JP Morgan said strength in the specialty chemicals company’s business segments and its move into high performance plastics had improved LANXESS’s outlook for 2012.

On this basis, the bank also upgraded LANXESS to an “overweight” rating from “neutral”.

For the fourth quarter of 2011, LANXESS reported a drop in net income to €5m, but said it expected strong growth in 2012 through higher sales.

At 10:57 GMT, LANXESS shares were trading at €62.04, down by 1.60% from the previous close of Germany’s Xetra DAX stock exchange.

Additional reporting by Leigh Stringer

($1 = €0.75)

By: Franco Capaldo
+44 (0)20 8652 3214

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