Symrise: Continued Solid Organic Sales Growth and Midterm Guidance Extended to 2028

Wide-moat Symrise reported third-quarter 2023 organic sales growth of 6.4%, ahead of the 4.5% Vara consensus. Growth was primarily driven by pricing actions (around 4%), with resilient volumes. Both segments contributed to organic growth, while exchange rates took a toll on reported sales, with a negative impact of 9.4% in the quarter. Management confirmed the 2023 full-year guidance of organic sales growth between 5% and 7% and a normalized EBITDA margin (excluding one-offs) of around 20%, which is aligned with our forecast. The midterm guidance (calling for organic growth between 5% and 7% and an EBITDA margin between 20% and 23%) was extended to 2028 from 2025 previously. Our midterm forecast is consistent with these targets, assuming average organic growth of 6% and an average EBITDA margin of 21% through 2027. Therefore, we make no changes to our forecast at this time and confirm our EUR 108 fair value estimate. We believe shares are attractive, offering an upside of around 15% from current levels.