Novozymes Falls as BofA Sees Lowest Return in Nearly 20 Years

• (PLX AI) - Novozymes shares were down 2.3% after analysts at Bank of America see the lowest return on invested capital in almost 20 years.
• • Bank of America cuts price target on Novozymes to DKK 370 from DKK 420, maintaining a rating of underperform
• • ROIC may fall to 17% this year, partly because of sizable investments are required to deliver the 5% mid-term growth target, BofA said
• • The company's premium valuation to peers is not justified given the execution risk, BofA said
• • The Q4 EBIT margin of 21% disappointed, and the 2022 guidance of 25-26% seems weak, DNB said, cutting their price target to DKK 410 from DKK 420 and maintaining a sell rating
• • The risk/reward is unfavorable, with the valuation not justified by the organic growth and earnings outlook: DNB