HeidelbergCement Finishes 2022 on a Positive Note, but We See Guidance As Slightly Ambitious

Narrow-moat HeidelbergCement finished 2022 on a positive note, delivering organic EBITDA growth of 3.1% during the fourth quarter and met its financial targets. The group managed to achieve a positive price/cost spread during the fourth quarter, benefiting from price increases in the high teens and lower energy costs. The company guided for 2023 organic revenue growth and EBIT between EUR 2.35 billion and EUR 2.65 billion, which mostly falls within with our expectations, albeit we are more conservative. We reiterate our EUR 71 fair value estimate, and while shares remain slightly undervalued despite a 40% rally during the last six months, CRH remains our preferred pick in the sector, offering investors higher growth and more defensive end-market exposure.