(new: closing prices, commentary DZ Bank)

FRANKFURT (dpa-AFX) - A massive sales and profit warning sent the shares of inverter manufacturer SMA Solar into a tailspin on Wednesday. They lost a good 31 percent to 28.62 euros at the close of trading and fell to their lowest level since the first quarter of 2022 at 27.82 euros.

"The sharp reduction in targets is a bitter disappointment even for cautious analysts, who had already warned of a high level of uncertainty in the second half of the year," said one trader. He recalled that SMA Solar had raised its annual targets for 2023 several times. However, the situation had already darkened by then, resulting in a share price loss of nine percent last year.

DZ Bank took the lowered forecast as an opportunity to downgrade the shares from "buy" to "hold" and more than halve the fair value from EUR 66 to EUR 30 per share. The extent of the profit warning is shocking and investor confidence is severely damaged, as SMA had still radiated confidence with the report for the first quarter, wrote analyst Thorsten Reigber.

Oddo BHF also cut its price target, from 66 to 42 euros, and revised its previous "Outperform" rating to "Neutral". "Despite general concerns, SMA has confirmed its annual forecasts twice," criticized the Oddo analysts. The profit warning did not really come as a surprise, which is also illustrated by the share price loss since the beginning of the year. This now amounts to almost 53 percent, making SMA one of the worst performers in the Dax family, which comprises the Dax, MDax and SDax.

The Oddo experts justified investors' cautious stance, even before the forecast was lowered, by stating that achieving the targets was heavily dependent on a hoped-for recovery in incoming orders in the residential and commercial segments from the third quarter onwards. According to the Group's new forecast, this is no longer to be expected, they wrote.

In 2022, SMA solar shares were still in high demand due to the boom in renewable energies and, with a gain of almost 80% by the end of the year, were among the top stocks in the SDax, to which they still belonged at the time. The positive sentiment continued until mid-2023 thanks to several high annual targets, with the shares rising to a record high of EUR 112.70 at the beginning of July.

However, negative industry news then made investors increasingly cautious in view of the price level reached, as the order momentum slowed. Despite the optimism of the solar technology group itself, more and more analysts pointed to demand problems and high uncertainties for the second half of 2024. They were right, as SMA now had to lower its targets with reference to high inventories./ck/lew/mis/ajx/jha/