SGS SA, the Services sector company, was revisited by a Wall Street analyst today. Analyst Suhasini Varanasi from Goldman Sachs upgraded the rating on the stock to a Hold and gave it a CHF85.00 price target.
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Suhasini Varanasi has given his Hold rating due to a combination of factors that suggest a more balanced outlook for SGS SA. The previous negative outlook has largely played out, and the risk/reward profile now appears more balanced. The company’s recent acquisition efforts, such as the ATS acquisition, are expected to positively impact earnings, potentially reversing the negative trends seen in recent quarters.
Despite the company’s stock underperforming against broader market indices since being added to the Sell List, there is potential for valuation support and possible upside if the company successfully executes its strategies and earnings momentum improves. The increase in the 12-month price target reflects a cautious optimism, acknowledging the potential for earnings to improve while recognizing the challenges that remain.
In another report released on October 3, RBC Capital also maintained a Hold rating on the stock with a CHF86.50 price target.