SGS: Credit Suisse downgrades buy rating
(CercleFinance.com) - Credit Suisse has downgrades buy rating ("outperform") on the certification and compliance group SGS, with its analysts having adopted a neutral stance.
Alongside this downgrade they have cut their target price from 2,700 Swiss francs to 2,400 Swiss francs, which is virtually in line with the share's current price.
Analysts' main argument is the "moderation" of organic sales growth, which should fall from 5.3% in 2018 to 4.3% in the first half of 2019 "given headwinds in Consumer, Certification, Transport and Industrial combined with tougher comparables in O&G and Minerals," their report says.
In general, "As growth slows, we expect this to limit the potential for SGS to positively re-rate in the coming months," Credit Suisse adds, which in particular cites the trade tensions between the US and China. Even though it still considers the Swiss group's prospects as "positive".
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
Alongside this downgrade they have cut their target price from 2,700 Swiss francs to 2,400 Swiss francs, which is virtually in line with the share's current price.
Analysts' main argument is the "moderation" of organic sales growth, which should fall from 5.3% in 2018 to 4.3% in the first half of 2019 "given headwinds in Consumer, Certification, Transport and Industrial combined with tougher comparables in O&G and Minerals," their report says.
In general, "As growth slows, we expect this to limit the potential for SGS to positively re-rate in the coming months," Credit Suisse adds, which in particular cites the trade tensions between the US and China. Even though it still considers the Swiss group's prospects as "positive".
Copyright (c) 2019 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.