Financing and Taxes Weigh on Roche - Berenberg Lowers Price Target but Remains Neutral

Within the analytical corridors of the private bank Berenberg, new figures have been calculated for the pharmaceutical giant Roche, leading to an updated recommendation: While the Swiss company remains at its previous "Hold" rating, the target price has moved from 290 to now 265 Swiss francs. Analyst Luisa Hector, who is behind the latest forecasts, cites two main reasons for the downgrade: higher financing costs and a rising tax rate. These factors have led Hector to lower her earnings expectations per share. Nevertheless, not everything at Roche seems to be subdued. The investment budget, which the corporation records on the credit side, is expected to be a pillar of stability in the year 2024. This implies that the margins – that important metric for profitability – should continue their upward trend. Over the next six months, Roche looks to various stimuli that could ignite its share price. Yet, the analyst remains somewhat cautious, speaking of an absence of "very big successes" that would be necessary to unleash the full valuation potential of the share and to impress the market. In short, the forecast paints a picture of moderate expectation: a certainty of stability, yet a wait for the major coup that could finally make Roche shareholders rejoice.