On Thursday, Deutsche Bank raised its recommendation on Henkel shares from 'sell' to 'hold', with a price target raised from 60 to 70 euros.

In a research note published this morning, the financial intermediary is slightly less negative about the German consumer goods giant.

While it believes that the company still has "a lot to prove", the analyst can't help noticing that the stock has lost 2.1% of its value since the start of the year, while the MSCI Europe has risen by 4% over the same period.

Knowing that its earnings per share (EPS) have outperformed by 15%, the PER on which the stock trades is now back to 14x at 12 months, he argues in the study.

While he believes that the first-quarter publication will not be likely to lead to a downward revision of consensus estimates, Deutsche is concerned about the level of profit margins in adhesives.

With regard to consumer staples brands, the professional points to the need to implement a cost-cutting program, but also sees a "considerable" need to invest in innovation.

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