Bureau Veritas: share price rises, Morgan Stanley more confident
January 12, 2024 at 06:37 am EST
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Bureau Veritas shares were one of the strongest performers on the SBF 120 index of the Paris Bourse on Friday, as Morgan Stanley upgraded its recommendation on the stock to 'overweight' from 'in-line weighting'.
At 12:20 pm, the inspection and certification specialist's shares were up 2.8%, their highest level for three months, while the SBF 120 index was up 0.8% at the same time.
In a study of the professional services sector, Morgan Stanley noted that the stock had lost value last year, despite an improvement in organic growth.
The broker attributes this downturn to a less buoyant business mix and an unfavorable currency effect.
However, he expects the Group's next investor day, scheduled for March 20, to act as a catalyst, with the presentation of new medium-term objectives.
With the stock now trading at a PER 2024 of around 17x, despite expected organic growth of 5%, a solid balance sheet and upside potential of over 25% compared with our target price, we are upgrading our recommendation to 'Overweight'," concludes the broker.
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Bureau Veritas SA is No. 1 worldwide in providing compliance evaluation and certification services applied to the quality, safety, health, environment and social responsibility fields. The group's activity consists of inspecting, analyzing, auditing, and certifying products, assets (buildings, industrial infrastructures, equipment, ships, etc.) and management systems (primarily ISO standards) compared to regulatory or volunteering reference standards. Net sales break down by activity as follows:
- industry and infrastructures (80.2%): analysis and control of hygiene, safety and environment, inspection and certification of industrial equipment, verification of construction compliance, certification of management systems,
- consumer goods (12.1%);
- marine (7.7%): inspection and classification of ships.
At the end of 2023, the group owns a network of nearly 1,600 offices and laboratories worldwide.
BUREAU VERITAS SA 
