Arkema's Q4 EBITDA and 2023 Guidance Broadly in Line With Our Expectations; Shares Undervalued

No-moat Arkema reported fourth-quarter EBITDA of EUR 291 million, broadly in line with company-compiled consensus and guidance, but down 30% over the high comparison base of 2021. Organic sales grew by 13.6%, reflecting price increases, but lower volumes, mainly hit by weaker demand in all segments, especially for coating solutions and high levels of destocking in Europe. For 2023, the group expects to benefit from its expansion projects in Asia and targets EBITDA of EUR 1.5 billion to EUR 1.6 billion, generally aligned with our estimate and company-compiled consensus. We don’t expect to make a material change to our EUR 105 fair value estimate. At current levels, shares are trading in 4-star territory.