Mixed Messages for Lenzing Shares as Analysts Adjust Views

Deutsche Bank cuts Lenzing's price target but sharply raises EPS forecasts. Analysts see no dividends until 2027 amid weak demand, high costs, and interim leadership.

The Austrian fiber manufacturer Lenzing is receiving conflicting signals from market analysts, highlighting the uncertain environment it currently navigates. The company is caught between persistent cost pressures and a slow recovery in global demand, a situation reflected in recent research notes that contain both positive and negative revisions.

Revised Targets and Upgraded Earnings Forecasts

In a notable move, Deutsche Bank Research has adjusted its stance on Lenzing. On Thursday, the bank's analysts reduced their price target for the stock from €25.00 to €21.00, reaffirming a "Hold" recommendation. This downward revision was primarily driven by lowered expectations for the company's operating results in the 2026 and 2027 fiscal years.

Paradoxically, the same analysis included significant upward revisions to earnings per share (EPS) projections. For the current year, Deutsche Bank now anticipates an EPS of €1.48, a substantial increase from its previous forecast of €0.45. The outlook for 2027 was also raised, with the new estimate set at €2.23 per share.

Dividend Pause and Neutral Stance from Peers

Echoing a cautious tone, Berenberg Bank also maintains a neutral position on the equity, assigning a valuation of €22.50 per share. For income-focused investors, the outlook is particularly dim. Analysts expect that Lenzing will not distribute any dividends over the next three financial years. The delayed rebound in worldwide fiber demand, coupled with continued high production expenses, is seen as a major hurdle to restoring previous profitability levels.

Technical and Leadership Challenges Emerge

The stock's recent price action adds to the concerning picture. Trading at €23.05 by midday on Thursday, the shares were down approximately 1.3%. From a technical perspective, the situation has deteriorated. The price recently fell below the 100-day moving average, situated at €24.08, extending a downward trend that has been in place since February. Since the start of the year, the stock has declined by nearly four percent.

Further uncertainty stems from the company's leadership situation. Following the departure of CEO Rohit Aggarwal at the end of January, Lenzing is currently being led by a three-person management team. In the absence of clear positive signals for global demand and a stabilized executive leadership, the potential for a sustained share price recovery appears limited for the time being.