Atos: Credit Suisse downgrades to 'sell'
(CercleFinance.com) - Already fairly unenthusiastic about the Atos stock, on which it previously had a “neutral” rating, Credit Suisse has now downgraded it to sell ("underperformance"), with doubts about the group's cash generation.
The broker has also cut its target price for the share by about 32% from 117 euros to 80 euros.
The share is currently down about 7% at 103 euros on the Paris Stock Exchange this morning.
Analysts' main argument for this is the French group's cash generation, which has recently increased. However, is this due to an improvement in the group's fundamentals? For Credit Suisse, which carefully analysed accounts published according to IFRS 15 standards, the answer is rather found in terms of “financial arrangements,” as detailed in the broker's note. The latter concentrate about 30% of the group's free cash flow and explain most of this aggregate's growth.
Credit Suisse therefore believes that Atos' cash generation is rather weak, while the group is also less dynamic, in organic terms - than Capgemini, for example.
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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.
The broker has also cut its target price for the share by about 32% from 117 euros to 80 euros.
The share is currently down about 7% at 103 euros on the Paris Stock Exchange this morning.
Analysts' main argument for this is the French group's cash generation, which has recently increased. However, is this due to an improvement in the group's fundamentals? For Credit Suisse, which carefully analysed accounts published according to IFRS 15 standards, the answer is rather found in terms of “financial arrangements,” as detailed in the broker's note. The latter concentrate about 30% of the group's free cash flow and explain most of this aggregate's growth.
Credit Suisse therefore believes that Atos' cash generation is rather weak, while the group is also less dynamic, in organic terms - than Capgemini, for example.
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.