RBC upgrades Evotec on 'over-discounted' outlook risks
** RBC upgrades Evotec EVTG.DE to "outperform" from "sector perform" after the shares dropped to five-year lows following the departure of long-term CEO Werner Lanthaler
** The broker remains cautious on 2024 outlook due to uncertainties such as unclear Sandoz-related revenues and costs, lumpy quarterly periods and a subdued biotech funding market
** But it says the current valuation over-discounts risks to Evotec's 2024/2025 guidance, pointing to potential double-digit growth rates, milestones and royalties
** RBC adds Evotec's solid business position is supported by its blue-chip partners, strong track record of revenue growth in its EVT Execute business, and an unlevered balance sheet
** It maintains a PT of 18.60 euros per share, but flags an upside to 23 euros should Evotec deliver on the broker's below-consensus expectations
** Out of 11 analysts that cover Evotec, nine rate the stock "strong buy" or "buy", and two "hold" - LSEG
Reporting by Chiara Holzhaeuser
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