Sturdy Switching Costs Support Drug Packaging Supplier Stevanato's Moat; Launch With $21.50 FVE

We are initiating coverage of Italian drug containment and delivery supplier Stevanato with a $21.50 fair value estimate, a narrow moat rating, and a Standard capital allocation rating. While shares have been volatile since the firm’s IPO in July 2021, with the stock down 35% from highs reached in September, we view shares as fairly priced near recent levels.