Shares in the German chemical company Evonik Industries AG surged 4% on Thursday, following an upgrade from Deutsche Bank. The investment bank predicts that Evonik will beat its Q2 earnings forecast, citing strong demand for the company's products.
Deutsche Bank analysts raised their price target for Evonik shares from €44 to €52, citing the company's solid financial performance. The upgrade is a result of Evonik's ability to maintain its profit margins despite increasing costs.
'We expect Evonik to benefit from the ongoing recovery in the chemicals sector, driven by strong demand from key end-markets,' the Deutsche Bank analysts said in a note to clients.
Evonik's shares have been on a steady rise over the past few months, driven by the company's solid financial performance and increasing demand for its products. The upgrade from Deutsche Bank is expected to boost investor confidence in the company, potentially leading to further gains in its share price.
In related news, the FTSE 100 index closed 0.2% higher at 7,532.6 on Thursday, with the FTSE 250 index rising 0.3% to 20,439.2.
Market analysts note that the upgrade from Deutsche Bank is a positive development for Evonik investors, but also highlight the potential risks associated with the chemicals sector. The sector has been impacted by supply chain disruptions and increasing costs, which could impact Evonik's profitability in the long term.