- Croda International
- 17 October 2025 09:11:30
Source: Sharecast
Berenberg said Croda's multi-year high enterprise value/underlying earnings discount versus its consumer peers left the shares "primed for a relief rally" following its "robust Q3 sales update" on 16 October.
Croda reported third-quarter group organic sales growth of 6.5%, exceeding 4.4% from peer Givaudan, led by marketshare gains in beauty actives, a strong performance in fragrances and flavours, and a recovery in beauty care.
The German bank stated that Croda's low starting valuation left the market "more inclined to overlook its imperfections" – namely, the sensitivity regarding one-third of its pharma unit being exposed to RNA/biotech-funding-squeeze news in the US.
"The pharma business did not grow sales in Q3," noted Berenberg. "However, we doubt that consensus group EBIT estimates will change much for 2025/26, primarily because trims to Life Sciences EBIT (including pharma) may be offset by better mix and operating leverage in the Consumer Care division in 2026."
Berenberg also reiterated its 'buy' rating on the stock.
Reporting by Iain Gilbert at Sharecast.com