🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Stocks

Citi maintains neutral on BASF with steady price target

EditorTanya Mishra
Published 27-09-2024, 09:35 pm
BASFN
-

Citi reiterated a Neutral rating on BASF SE (ETR:BASFN) (BAS:GR) (OTC: BASFY) with a price target of EUR44.00. BASF announced plans to rebase its dividend to "at least €2.25," a decrease from the current €3.40. This adjustment comes prior to the company's Capital Markets Day (CMD). Alongside the dividend change, BASF intends to support shareholder returns through buybacks, with a commitment to €4 billion in buybacks starting in 2027.

These buybacks are part of a broader strategy that includes actively exploring options for its Agriculture, Coatings, and Battery Materials businesses, aligning with previous leaks about the company's strategic direction.

The company's management has also pledged a cumulative dividend payment of €8 billion until 2028, which, when combined with the planned buybacks, is expected to keep the total cash return to shareholders relatively stable. This move is anticipated to address the ongoing debate about the company's free cash flow and dividend coverage.

Additionally, BASF's management has set an EBITDA target of €10-12 billion for 2028, assuming mid-to-upcycle conditions, which aligns with Citi's projection of €10 billion mid-cycle EBITDA.

The strategic measures announced by BASF are seen as a positive step towards addressing longstanding investor concerns. The company's commitment to a rebased dividend and share buybacks, as well as its clear EBITDA targets for the coming years, are expected to be well-received by the market.

These initiatives are part of BASF's efforts to implement significant changes to enhance shareholder value and address the issues that have been a focus for investors.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.