Fresenius SE: Barclays no longer a buyer
(CercleFinance.com) - Barclays has downgraded its rating on German healthcare group Fresenius from "overweight" to "equal weight" and has cut its target price on the stock from 70 euros to 51 euros.
While the broker thinks that Fresenius SE's preliminary guidance for 2019 looks "conservative," potential changes to German hospital pricing regulation in 2020 leave Barclays expecting further downside in margins.
Even worse, regulatory pressure at European hospitals could persist longer than many initially expected, Barclays points out in a note to clients.
"With growth hampered in the short term at Helios and the potential for further downgrades next year, we take a more cautious stance on the stock, despite valuation and a strong Kabi," it adds.
Barclays says that it is waiting for more clarity before considering taking a more constructive view on the share.
The shares of Fresenius are currently down 1.6 percent at 42.7 euros.
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