Sika AG

SIKA: XSWX (CHE)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	CHF 594.00	Wkymv	Lnrcczct

Sika: Initiating Coverage of Sika With a Narrow Moat Rating and CHF 230 Fair Value Estimate

Matthew Donen

Apr 17, 2024

We’re initiating coverage of construction chemicals producer Sika with a fair value estimate of CHF 230 and a narrow moat rating. We anticipate Sika will grow earnings per share at an annualized rate of 12% during our forecast period. We believe its attractive growth prospects, brand reputation for reliability, and runway for mergers and acquisitions justify our implied 26 times forward P/E multiple, which is consistent with its 10-year average. Shares are currently trading at a 14% premium to our fair value estimate, thus we suggest investors wait for a better entry point.

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