SMT Scharf has to make high write-offs at the Canadian subsidiary RDH. Further depreciation on intangible assets is also necessary, the total value is 6.6 million euros. This also ensures a profit warning.
However, Pareto Securities analysts believe that the worst lies behind SMT. The order backlog stands at 30.4 million euros, which is almost twice as much as a year ago. In addition, the coal price rises again, which can affect the orders.
The experts believe that there will be a significant recovery in 2021. Mining companies are likely to increase their investments again. This is where SMT comes in. The experts expect that the EBIT margin can go in the direction of 10 percent in the future, also due to cost measures.
You confirm the buy recommendation for the shares of SMT Scharf. The price target increases from EUR 9.80 to EUR 10.50.
The shares of SMT Scharf gain 2.9 percent at noon to 9.08 euros.