Wacker Chemie AG shares declined by more than 3% on Tuesday following a reassessment from UBS, which moved the stock from "buy" to "neutral." UBS said the company's near 40% rise year-to-date has left constrained upside at current market levels.
The bank upgraded its 12-month price target to €104 from €84, representing roughly 3% potential upside from Wacker's previous closing price of €100.70.
UBS analysts wrote: "After the recent re-rating, we see a more balanced risk/reward at current levels given limited visibility on the timing and magnitude of further earnings upside," underscoring the view that the stock's strong run limits material near-term gains.
Valuation snapshot
UBS noted that Wacker now trades at about 9x 2026 estimated EV/EBITDA, noticeably above its 10-year historical average of 6x. That higher multiple forms part of the rationale for tempering expectations despite an increased price target.
Key operational uncertainties
The downgrade hinges on two principal debates highlighted by UBS. First is the outcome of a U.S. Section 232 trade probe into polysilicon, with a decision expected by late July 2026. Second is the timing and strength of the cyclical recovery in the Silicones and Polymers businesses.
On polysilicon, UBS reported the business generated about €100 million in EBITDA in fiscal 2025, compared with a long-run average of roughly €350 million across fiscal years 2006 through 2025. UBS projects only a partial rebound to €170 million by fiscal 2030.
"Polysilicon remains highly binary, with outcomes ranging from a positive decision enabling re-scaling of solar volumes, to a negative outcome likely resulting in capacity rationalisation," the analysts said.
Chemicals division outlook
UBS expects the Chemicals segment to deliver sales growth of about 3% per year over fiscal years 2026 through 2030, a pace UBS says falls short of historical trends. The bank projects EBITDA margins in Chemicals will recover to around 15% by 2030 from approximately 12% in fiscal 2025, well under Wacker's prior target of greater than 20%, which UBS describes as now "appears de-emphasised." The €300 million PACE cost-reduction programme is identified as the primary support for earnings.
Revisions to forecasts and balance sheet path
UBS materially cut its 2026 earnings expectations, lowering the EPS estimate by 57.7% to €0.39 from €0.93, a move it attributes in part to higher interest rate assumptions. The bank also reduced its 2026 dividend per share forecast by 60.7% to €0.20 from €0.50.
For the group overall, UBS projects revenues of €5.93 billion in fiscal 2026 and EBITDA of €652 million. Net debt is forecast at €1.10 billion at the end of 2026, moving to a modest net cash position of €7 million by fiscal 2030.
Price target construction and scenario range
UBS's €104 target is the weighted average of two valuation approaches: a discounted cash flow valuation of €105 per share that uses a weighted average cost of capital of 8.6%, and a sum-of-the-parts valuation of €103 per share based on 10x 2026 EV/EBITDA.
The bank outlined an upside scenario at €160 per share and a downside at €55, describing the risk skew as 1.5-to-1 in favor of upside within its framework.
Implications
UBS's decision to move to neutral reflects a view that much of the company's near-term positive developments may already be priced in, while key catalysts remain unresolved. The combination of a higher multiple relative to the decade average and significant judgment around polysilicon policy outcomes and segment recoveries underpin the more cautious stance.