<WIRE> Citi upgrades Sims (ASX:SGM) to 'buy'; Forecasts Long-term Recoveries

Investment bank Citi has upgraded its rating for shares of the Australia-based Sims to ‘buy’.

The decision comes as analysts predict ex-China steel production to increase this year and Turkish scrap volumes to rise by 20% compared to previous corresponding period.

The brokerage firm also expects the company’s EBIDTA to reach A$567 million by FY26 with margins restored to 4%.

Looking further ahead, they anticipate Sims to benefit from steel decarbonisation trends in the long run.

Despite this, they forecast a challenging H2 FY24 for the company due to declining ferrous scrap prices, which could pose risks to FY24 earnings forecasts.

Of analysts working on the company, 13 rate the stock as ‘buy’ or higher, seven hold it, and five rate it as ‘sell’ or lower with a median price target of A$13.50 according to LSEG data.

Year-to-date, the stock has fallen approximately 24% as of the last close.

Sims (ASX:SGM) is a global leader in metal recycling, ferrous and nonferrous metals trading.

View full chart on Save $30 on a Pro or Premium TradingView account

Save $30 on a Pro or Premium TradingView account

Supported by

<SPON> Trade share CFDs with Plus500

Global online trading services company, Plus500:

Plus500 trading platform allows you to trade shares from all popular markets such as USA, UK, Germany and more, with leverage and low spreads. Using our advanced trading tools, you can also control your profits and losses.

Plus500AU Pty Ltd, AFSL #417727 issued by Australian Securities and Investments Commission. Based in Sydney.


Subscribe to the newsletter

Receive whispers every day in your inbox.