Oddo BHF maintains its "underperform" rating on Elior shares, with its target price raised from €1.9 to €2.2.

The broker points out that Elior yesterday published above-expectations results for EBIT 2023, with a margin of 1.1% (vs. consensus 1%).

Elior anticipates an EBIT margin of around 2.5% in FY24, i.e. +140 bp. With regard to the medium-term outlook, Elior has raised its target for synergies linked to the integration of DMS, now expected to reach €56m by 2026.

In this context, Oddo BHF is targeting organic growth of 5.1% (vs. 5.3% prec.) for 2024, at the top end of the guidance range of +4/5%, which includes a proportion of voluntary contract exits.

' The sharp upward revision of our 2024 EPS (from 0.25 to 0.40 euro, i.e. +60%) stems mainly from the assumption of continued capitalization of tax loss carryforwards in France. On the other hand, our 2025 EPS estimate remains unchanged overall," concludes the analyst.


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