GS ups FLSmidth to 'buy' on improving margin prospects

** Goldman Sachs upgrades FLSmidth FLS to "buy" from "neutral," as it expects cost savings and increased service and product mix to drive the group's margins higher

** The stock, up 4% at 0750 GMT, is among top gainers on STOXX 600 SXXP index

** The brokerage expects the Danish mining and cement technology specialist to increase its margins by 320 basis points to 14.2% by 2027

** A re-rating is warranted as FLSmidth's current valuation sits below its 10-year median despite improving profitability prospects, it says

** The broker sees the targeted divesture of Cement business as a potential catalyst, turning FLSmidth into a pure-play mining firm with higher copper and gold exposure, and an improving returns profile

** GS is "relatively cautious" on near-term demand due to tariffs, but expects ongoing project studies to turn into orders from 2026

** "With low current leverage and any potential cash inflow from a Cement divestment, we see scope for increased investment in organic and inorganic growth, including an expansion in PCV," it adds

** GS lifts TP to DKK 430, which implies about 20% upside

** Out of 14 analysts covering the stock, 10 rate it "strong buy" or "buy," three "hold," and one "sell," as per LSEG data