Rational AG

RAA: XETR (DEU)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	€336.00	Fvbjcx	Msxnzxlv

Rational Earnings: Double-Digit Operating Profit Growth Delivers a Strong Beat; Maintain Fair Value

Matthew Donen

Aug 6, 2024

We’re maintaining our EUR 630 fair value estimate for narrow-moat Rational following its impressive second quarter, which beat FactSet consensus estimates for revenue and EPS. Shares are trading 4% higher intraday. Second-quarter EBIT growth of 12% year over year outpaced its 6% revenue growth and was underpinned by lower raw material costs. Full-year guidance was maintained, which might seem conservative given its impressive operating growth and large beat on the bottom line. Shares screen as overvalued, trading at a 25% premium to our fair value estimate.

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