On Monday, Bank of America reiterated its Buy recommendation on Eramet, leaving its target price unchanged at 100 euros.
In a research note, the American investment bank highlights a stock that is "deeply undervalued" (deep value) after its recent correction, attributed to the economic slowdown and China's difficulties.
At its current price levels, the stock is trading at 3.3x its Ebitda forecast for 2025, notes the New York-based firm, compared with an average of around 4.4x during this usual period of the industrial cycle.
With Eramet recently announcing its intention to take full control of the Centenario (Ratones) lithium project in Argentina, BofA calls this a "positive" project, as the mining group will pay around 0.7 times the net book value of an asset that appears largely risk-free.
From its point of view, the main concern remains the possibility of a recovery in lithium prices, a market for which Rio Tinto recently evoked the prospect of "exponential" growth, recalls the bank in its study.
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Eramet, a global mining and metallurgical group, is a key player in the extraction and valorisation of metals (manganese, nickel, mineral sands) and the elaboration and transformation of alloys with a high added value (high-speed steels, high-performance steels, superalloys, aluminium and titanium alloys).
The group supports the energy transition by developing activities with high growth potential. These include lithium extraction and refining, and recycling.
Eramet positions itself as the privileged partner of its customers in sectors that include carbon and stainless steel, aerospace, pigments, energy, and new battery generations.
Building on its operating excellence, the quality of its investments and the expertise of its employees, the group leverages an industrial, managerial and societal model that is virtuous and value-accretive.
Net sales break down by family of products mainly between manganese (60.8%), nickel (30.6%), and mineralized sands (8.5%).
Net sales are distributed geographically as follows: France (1.3%), Europe (20.4%), China (31.1%), Asia (29%), North America (12.4%), Africa (2.3%), Oceania (2.2%) and South America (1.3%).