Berenberg lowers rating on ABCAM to 'hold'

Berenberg said ABCAM was a "high-quality company" and forecast an 11% sales compound annual growth rate for 2020 to 2024, stating it had "no doubt" about the firm's longer-term potential.

However, the analysts said the question was when it will materialise.

The German bank stated that consensus for 2022-24 sales had "barely changed" compared to the pre-Covid-19 period, down less than 5%, implying any loss of revenue in 2020 was merely delayed, and with consensus expecting accelerated growth in 2021/22, Berenberg said it disagreed.

"We believe the Covid-19-related revenue loss will not come back as scientists cannot catch up with experiments they have missed," said the analysts.

"Without the Covid-19-related sales loss being compensated, the - 1% sales growth at constant exchange rates (CER) in FY 2020 means the 2024 sales target set in 2019 may be delayed by one year, in our view."

Reflecting that and the potentially longer-than-expected Covid-19 impact, Berenberg said it was now roughly 8% below 2021-24 consensus on sales and cut its price target to 1,180.0p from 1,450.0p.