GBC AG Maintains "BUY" Rating on Cenit AG with Target Price of €20.55

GBC AG has issued a "BUY" recommendation for Cenit AG, setting a target price of €20.55, reflecting optimism for the company's future growth. The research, led by analysts Cosmin Filker and Marcel Goldmann, indicates that Cenit AG exceeded its sales forecasts for the year, posting earnings and revenue in line with expectations. The company's annual sales reached €184.72 million, benefiting from its aggressive M&A strategy which included the acquisition of three new companies in the previous year.

The growth in sales was significantly driven by the newly acquired companies, contributing €7.84 million and accounting for 4.8% of the total sales increase. Organic growth also saw a robust 9.1% increase, boosted by the full-year inclusion of ISR, acquired in 2022. Notably, consulting and services sales surged by 33.5% to €74.38 million, while third-party software sales grew by 5.2%. The transition towards SaaS sales led to a slight decline in own software sales.

Despite facing M&A-related expenses and higher personnel costs, Cenit AG's EBIT improved to €9.22 million. The company's after-tax earnings saw a decrease due to higher interest expenses and financial instrument write-downs. Looking ahead, Cenit AG's management is optimistic, projecting sales between €195 million to €202 million for 2024, and aiming for an EBIT margin of 6.0%. The "CENIT 2025" plan targets a total sales increase to €300 million and an EBIT margin of at least 8%, supported by two to three acquisitions annually.