Dim glimmers of success at BASF
In the current economic climate, the demand for BASF, the German chemical giant, shows no clear signs of a significant boost. CEO Markus Kamieth has highlighted that the company's business is operating in a volatile 'stop-and-go' pattern. This unpredictability has led to a need for patience and resilience in the short-term.
This week, analyst support for BASF has been scarce, with no institutions issuing an optimistic forecast specifically for BASF shares for the year 2022. However, the focus of discussions and forecasts among analysts has been on the years 2024 and 2025, with some expecting stabilization or recovery by 2025.
Despite the short-term challenges, there are reasons for optimism regarding the coming year for BASF. Kamieth's outlook did show some bright spots, both in the short-term and long-term. Oliver Schwarz, in his Tuesday report, stated that no significant improvement is expected in the third quarter compared to the previous quarter for BASF.
The Fed's interest rate cut yesterday evening may provide some tailwind for BASF's shares. The stock of BASF is showing relative weakness in the current trading week, but the company is currently favorably valued in historical comparison.
Analyst Sebastian Bray, following an investor event, noted that BASF's business is currently characterized by a difficult-to-predict 'stop-and-go' pattern. Berenberg and Warburg Research have both maintained their 'Hold' ratings for BASF, with Berenberg keeping its target price at 44.00 euros and Warburg adjusting its fair value for BASF shares from 45.00 to 46.00 euros.
Interestingly, the majority shareholder and CEO of the publisher Boerse-Medien AG, Mr. Bernd Förtsch, has taken positions in BASF that could benefit from its potential price development.
In conclusion, while the short-term outlook for BASF may be challenging, the long-term prospects for the company remain good. Investors may want to maintain a watchful eye on BASF's performance in the coming months, as the company navigates the current economic climate.
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