Jefferies initiates coverage of Syensqo, the specialty chemicals company resulting from Solvay's recent spin-off, with a 'hold' recommendation and a price target of 78 euros, displaying a preference for its key peer Arkema.

While it believes that 'Syensqo deserves credit for finishing 2023 above its peers on the operational front', the broker remains concerned about limited free cash flow generation over the forecast period.

Jefferies also points to a normalization of prices and margins in key end-markets, which it believes is having an impact on earnings growth, with the broker thus falling short of the company's medium-term targets.

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