Inbox: Das sagen die Berenberg-Analysten zu Lenzing

Die Berenberg Bank hält von 4. bis 7. Dezember ihre European Conference ab. Mehr als 350 Unternehmen werden sich präsentieren. Darunter auch einige österreichische Companies. Im Conference Book gibt es für die Investoren Zusammenfassungen der Berenberg-Analysten zu den präsentierenden Firmen.

Zu Lenzing (Hold, TP 120 Euro) heisst es: 

What goes up must come down

●  Our view in a nutshell: We like Lenzing’s strong market positioning in speciality fibres that are its primary earnings driver. The company has a 95% market share globally in the Tencel and 65% in Modal fibres, where we estimate it makes EBITDA margins of c35%. But we are cautious about the outlook for commodity viscose pricing over the next two years owing to above-demand increases in capacity. This is particularly the case given that the first planned new Tencel plant is only due onstream in Q2 2019.

●  Recent trends and outlook: Lenzing reported Q3 results on 15 November. While headline EBITDA of EUR126m was only a modest miss versus consensus expectations of EUR129m, the stock fell by c6% on the day. The primary driver of this development in our view consisted of management comments stating that the group “expects a much more challenging market environment of standard viscose during the coming quarters”. The group continues to expect a good 2017, continuing good demand growth, and appears confident in pricing of its speciality fibres. But in our view it is likely that consensus estimates for 2018 need to fall – substantially.

●  Key questions for management: 1) When does management expect to have visibility on the extent and timing of the 600,000-900,000 tonnes (c10- 15%) of capacity deployments to the viscose industry expected for 2018? 2) Is Lenzing likely to achieve its target of 75% backward integration in the key input dissolving wood pulp (currently 57%) by 2020? When will an announcement be made in this respect? 3) Does management have any indicators of how well speciality fibre pricing will hold against the backdrop of falling viscose prices. 4) Has Lenzing already secured the necessary pulp supply for its 90kt US tencel facility, currently under construction? 5) What are the EBITDA headwinds for 2018 to be expected from less favourable FX and higher prices for the input caustic soda?

● Valuation, and where we differ from consensus: On our estimates, Lenzing trades on 2018 P/E of 12.5x. This is i) cheap relative to the European chemicals average of c17x; and ii) an 11% discount to the five year average level of 13.9x. But the potential for two gruelling years of downward movement in viscose prices is likely to prevent a rerating in the year term. Our 2018 EBITDA estimates are c8% below Bloomberg consensus.