Broker tips: Valterra Platinum, Zegona Communications
By Iain Gilbert
Date: Monday 21 Jul 2025
(Sharecast News) - Analysts at Berenberg lowered their target price on precious metals group Valterra Platinum from 2,600.0p to 2,500.0p on Monday following the release of its Q2 production results and H1 trading statement.
Berenberg noted that refined platinum group metals production and sales came in 12% and 8% ahead of its forecasts, respectively, driven by a larger release of work-in-progress inventory.
However, Bernberg said that despite now guiding to the lower end of metal-in-concentrate volumes for 2025 due to flooding at the company's Amandelbult mine, and guiding H1 headline earnings per share to roughly 56% below visible alpha consensus, a strong day for PGM prices helped to lift the shares to close up by 5.8%, which it thinks is unjustified.
Berenberg increased its H1 opex and depreciation expectations, which reduced its FY25 earnings estimates and its price target.
"We update our model for the results and bring our H1 earnings in line with guidance, cutting 2025 EBITDA by 21% and headline EPS by 36%," said the German bank, which also kept its 'sell' rating on the stock.
"The shares are currently trading on 1.47x NAV and 11.9x 2025E EBITDA, and our price target represents 32% downside."
Analysts at Canaccord Genuity hiked their target price on Zegona Communications from 835.0p to 980.0p on Monday following the group's recent FY25 results.
Canaccord Genuity noted there was no new news on Zegona's fixed network monetisation in its FY25 results, other than it was "well-advanced", making this "a good opportunity" for investors to focus on the strong execution of the company's operational turnaround.
In addition to the "impressive operational transformation", Canaccord Genuity continues to believe Zegona can extract more than €2.0bn from a combination of dividend recaps and equity stake sales from its two Netco JVs.
"This should enable it to pay a special dividend of c.£1.6/share (~20% of mkt cap), allowing the subsequent cancelation of EJLSHM's 69% stake. The reduction in share count would imply 'look-through' value of £7.5-15/share, based on peer multiples," said the Canadian bank, which reiterated its 'buy' rating on the stock.
"Our estimate upgrades flow through to a raised target price of 980p from 825p. This is based on a blend of: 1) an 80% weighting assigned to the average of different proforma post-Netco monetisation valuations (4.5x to 6.5x FY26e EV/adj. EBITDAaL); and 2) a 20% weighting of a standalone/'ex Netco monetisation' valuation based on a 5.5x CY26E EV/adj. EBITDAaL multiple."
Reporting by Iain Gilbert at Sharecast.com
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