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FRANKFURT (dpa-AFX) - A cost-cutting program at Stabilus weighed heavily on the automotive supplier's shares on Friday. They fell by up to almost six percent and, by midday, were still down 4.6 percent to 23.80 euros, bringing up the rear in the SDax small-cap index.
This put a damper on the recent tentative recovery: from their high since the beginning of August, the shares fell back to the level of two weeks ago. They slipped below the 21- and 50-day lines again, which are considered technical indicators for the short- and medium-term trend. The price decline since the beginning of the year now totals more than one-fifth.
Stabilus is making cuts due to the difficult market environment and is eliminating 450 jobs. The specialist for trunk gas springs has estimated the costs of the savings program at 18 million euros. Due to corresponding provisions, consolidated earnings for the current fiscal year are expected to be only €25 million, which is below the average analyst estimate of €47.1 million.
According to one dealer, the cost-cutting measures make sense. However, their necessity underscores that the market situation remains difficult and that the company must make additional efforts to achieve the strategic goals set for 2030. These efforts come at a price, but they could be worthwhile.
The trader also emphasized that Stabilus is sticking to its forecasts for day-to-day business – just a few days before the end of the fiscal year. This gives cause for confidence that Stabilus will achieve its goals. Another stock market expert echoed this sentiment, emphasizing that confirmation of the remaining outlook should be reassuring. Falling short of market expectations for consolidated earnings should not be a major setback.
Warburg analyst Marc-Rene Tonn also remained optimistic and maintained his buy recommendation for Stabilus. With a price target of €44, he believes the shares have upside potential of around 85 percent. The group restructuring is to be welcomed and should also pay for itself in a relatively short time. However, the cost-cutting program also highlights the problems facing the automotive supplier.
Stabilus intends to implement the program by the end of September 2026. In the following fiscal year 2027, the SDax group is already targeting savings of around 19 million euros. From 2028 onwards, annual savings of around 32 million euros are expected.
