The shares of the drug researcher EVOTEC fell sharply again on Monday after a sell recommendation. At 7.62 euros, they reached a low since the spring of 2017. In the current year, they have lost about two-thirds of their value, making them one of the weakest stocks in the DAX family, which includes DAX, MDAX, and SDAX. Only the shares of the meal kit company HelloFresh have experienced similar losses. Via XETRA, they ultimately went down by 9.52 percent to 7.60 euros.
The price slump was triggered by analyst Naresh Chouhan from research firm Intron Health, who recommended selling EVOTEC shares in a study with a price target of 7 euros. His estimate for the operating result (Ebitda) in 2024 is 22 percent below the consensus, even though it was significantly lowered last month. Chouhan emphasizes that even a strong recovery in the second half of the year would not change his low Ebitda forecast.
Chouhan identifies a total of five risk factors for which there are no quick solutions. The most serious is the weak operational leverage that already existed before the cyberattack. Despite positive sales development, there is too little profit left in the end. EVOTEC "buys" barely profitable sales, according to Chouhan. Furthermore, he considers it realistic that credit agreements could be breached. Although this is not a major issue in itself, it further highlights the company's operational problems.
The current developments highlight the challenges faced by EVOTEC and underscore the pressure the company is under to improve its financial stability and operational efficiency.
