BASF: no longer a 'top pick' for Barclays
(CercleFinance.com) - Barclays Capital has removed German chemicals group BASF from its "top pick" list on Thursday, saying that near-term risks have more than offset long-term value.
After falling by close to 30% over the past year, the shares are pricing in a much more difficult trading environment, says the British broker, although the risk of a profit warning is not sufficiently appreciated by the market, it noted.
However, due to a combination of factors, including the level of the river Rhine and potential year-end destocking, the risk that the company will miss its full-year guidance has increased "materially," Barclays said.
As a result, the broker has cut its target price for the stock to 80 euros, and has downgraded its rating on it to "equal weight."
Over the longer term, BASF's new strategy is addressing key points and Barclays thinks that the company will become a "better performing company."
BASF shares are currently down 0.8% at 65.2 euros after these comments.
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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.
After falling by close to 30% over the past year, the shares are pricing in a much more difficult trading environment, says the British broker, although the risk of a profit warning is not sufficiently appreciated by the market, it noted.
However, due to a combination of factors, including the level of the river Rhine and potential year-end destocking, the risk that the company will miss its full-year guidance has increased "materially," Barclays said.
As a result, the broker has cut its target price for the stock to 80 euros, and has downgraded its rating on it to "equal weight."
Over the longer term, BASF's new strategy is addressing key points and Barclays thinks that the company will become a "better performing company."
BASF shares are currently down 0.8% at 65.2 euros after these comments.
Copyright (c) 2018 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.