BASF's Evonik Ambitions Face a Price Ceiling as Jefferies Cuts to Underperform
Published on 11/11/2026 at 19:31 | Editorial boerse-global.de
Jefferies has stripped BASF of its "Hold" rating, moving the stock to "Underperform" while keeping a €44 price target unchanged — a signal that analyst Priyanka Patel sees more downside risk than upside promise in the current setup. The downgrade lands as BASF weighs a potential acquisition of Evonik, a deal that could carry strategic logic but only if the price stays within reason.
Patel's central concern is earnings. She projects 2027 EBITDA before special items at €7.4 billion, roughly 5% below the consensus. Persistent overcapacity, weak product spreads and a demand recovery that has yet to materialize all feed into that gap, and she expects the surplus capacity to linger into the new year rather than clear quickly.
The Evonik Question: Strategy Versus Price
Reuters reported that Evonik turned down two BASF offers, at €22.15 and €24 per share. From Jefferies' vantage point, anything above €26 per share would be excessive and would risk heavier dilution. That threshold effectively draws a line under what BASF can afford to pay before the strategic benefits are swallowed by the cost.
CEO Markus Kamieth has publicly ruled out a merger "at any price," a stance that offers shareholders some protection against overpaying — provided BASF holds that line if Evonik pushes for more. Jefferies, for its part, is not convinced the strategic upside alone justifies a positive call on the whole package.
Should investors sell immediately? Or is it worth buying BASF?
Berenberg takes a different tack. The firm expects talks over an Evonik deal could drag on for months without resolution, and it stays at "Hold" with a €51.50 target, describing the near-term business as robust.
Gas Costs and the 2027 Earnings Crunch
Forward gas prices lead Jefferies to estimate a potential earnings hit of about €400 million in 2027. Hedges and long-term contracts should absorb part of that blow, but not all of it. Should the energy-cost burden materialize as projected, BASF would have less room for the kind of large-scale financial commitment an Evonik deal would require.
Berenberg flags a related worry: uncertainty over future profitability in upstream chemicals. For a major acquisition, that makes for a demanding backdrop while the existing business is still under earnings pressure.
CoreShift and the Calendar Ahead
Management's answer to the margin squeeze is CoreShift, a program aimed at cutting fixed cash costs by 20% by 2029 compared with 2024. Delivering on that target would give BASF an internal buffer against the earnings drag Jefferies anticipates.
Investors have two near-term markers to watch. The agricultural division's capital markets day is set for November 24, and the next set of results is due February 26, 2027.
BASF at a turning point? This analysis reveals what investors need to know now.
The analyst community remains divided. Ten analysts recommend buying BASF, nine sit on hold or neutral, and six lean negative — a spread that reflects genuine disagreement about how quickly the company can turn its operations around.
What would shift the picture? A pickup in demand or an easing of margin pressure would justify a more constructive view, and Patel's cautious forecast would lose credibility if BASF manages the overcapacity and energy costs better than she expects. Until then, the stock's fate hinges on two linked tests: progress in shoring up earnings, and discipline in any Evonik transaction. A sensibly priced deal would work in BASF's favor; an expensive one, arriving alongside the headwinds Jefferies foresees, would not.
Ad
BASF Stock: New Analysis - 11 November
Fresh BASF information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
