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2007: All-time high of EUR 66.11
12. July 2007
2007: All-time high of EUR 66.11
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Volkmar Held
As a freelance writer, Volkmar Held reports for voestalpine on topics that move people. The content of his stories ranges from archaeometallurgy to future technologies.
On 12 July 2007, the voestalpine share climbed to an incredible peak. At EUR 66.11, it reached its all-time high.
12 July 2007 was a special day for the voestalpine share: its share reached its all-time high thus far of EUR 66.11. This meant that the share price was eleven times higher than at the time of the IPO in 1995—a rise of more than 1,000%!
Spectacular rise of the voestalpine share
voestalpine AG boasted a record result in the 2006/07 business year. The value of its share had almost doubled. Profit from operations (EBIT) surpassed the billion mark—and the optimistic expectations of the analysts. They issued buy recommendations and increased their price targets—as did leading investment banks. The figures of the previous 2006/07 business year and the economic situation at the time prompted analysts to give consistently positive assessments. The takeover of BÖHLER-UDDEHOLM AG was seen as another indication of a sustained uptrend.
View from the top
Michael Buhl, CEO of Wiener Börse AG, commented positively on the foreseeable exit of Böhler-Uddeholm from the stock exchange: the Böhler capitalization would be absorbed by voestalpine and “we would therefore have a much stronger and more liquid Voest share.” During this record-breaking period, Austria’s leading share index ATX broke through the 5,000-point mark for the first time and from its view from the top could already see the clouds brewing on the US real estate market.
Sudden fall
The turmoil on the US markets significantly slowed down any growth. Real estate crisis, financial crisis, crisis of confidence were all buzz words on the path toward recession. In August, Goldmann Sachs revised the voestalpine price target downward, giving a sell recommendation. Three weeks after its all-time high, the share price had fallen by 20 percent. The head of Böhler-Uddeholm, Claus Raidl, addressed the issue frankly: “In 2008, we will pull through quite well, but after that, the good economic times will come to an end.”
Two decades ago voestalpine AG started out on its path to becoming a privatized and exchange-listed company. The ‘IPO 1995—20 years on the stock exchange’ series describes key events on the path to becoming an internationally successful steel-based technology and capital goods group.
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All-time high
The all-time high is the highest price reached by a security since being issued.Price target
The price target is the market price that a share should reach within a defined period of time according to assessments by experts (analysts). Analysts determine the value based on future projections and conclusions. As they take not only “hard” data, such as a company’s key figures, into consideration but also the anticipated general economic and industry-specific development or political factors, there are naturally significant differences in how stocks are evaluated.
Volkmar Held