JPMorgan Upgrades Fresenius SE to 'Overweight'

Analyst: Company's Shareholder Yield Attractive

JPMorgan analyst David Adlington upgraded Fresenius SE (ETR:FRES) to 'overweight' from 'neutral' on Tuesday, citing the company's attractive shareholder yield and a potential catalyst from its Fresenius Medical Care unit.

Upgrade Based on Shareholder Yield

Adlington said in a note to clients that Fresenius's current shareholder yield of 10% is "very attractive" in the current low-yield environment.

He estimated that the company's dividend yield will remain above 6% over the next three years, which is "a key support for the shares."

Potential Catalyst from Fresenius Medical Care

Adlington also highlighted the potential for a catalyst from Fresenius Medical Care, the company's largest division.

He noted that Fresenius Medical Care is expected to benefit from the growing demand for dialysis services and the company's recent acquisition of NxStage Medical.

Target Price Raised

Along with the upgrade, Adlington raised his target price on Fresenius to €32 from €29.50.

The analyst said that the new target price reflects his increased confidence in the company's long-term prospects.