Anglo American: stay cautious on shares, analyst says.
(CercleFinance.com) - Shares of miner Anglo American are down on the London Stock Exchange on Tuesday after an analyst recommended investors to stay "cautious" on the shares, despite of their cheap multiples.
In a research note sent to clients this morning, Barclays maintains its "equal weight" rating on the stock.
"Despite Anglo American's stock trading on 3.8x EV/EBITDA and 17.4% FCF yield (2017), we still recommend a cautious stance," the brokerage firm writes in the report.
In particular BarCap warns that if Anglo can't sell the South African assets, or can, although on poor terms, it will remove a key re-rating catalyst for the equity.
Finally, Barclays thinks that the group is unlikely to pay dividends again until 2018 .
"All this suggests the discount to peers is likely to remain," the broker says, preferring rival stocks such as Rio Tinto or Glencore.
Shares of Anglo American are currently down 0.5 percent at 1,060 pence, while the STOXX Europe 600 Optimised Basic Resources index is down 0.2 percent.
Copyright (c) 2017 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.
In a research note sent to clients this morning, Barclays maintains its "equal weight" rating on the stock.
"Despite Anglo American's stock trading on 3.8x EV/EBITDA and 17.4% FCF yield (2017), we still recommend a cautious stance," the brokerage firm writes in the report.
In particular BarCap warns that if Anglo can't sell the South African assets, or can, although on poor terms, it will remove a key re-rating catalyst for the equity.
Finally, Barclays thinks that the group is unlikely to pay dividends again until 2018 .
"All this suggests the discount to peers is likely to remain," the broker says, preferring rival stocks such as Rio Tinto or Glencore.
Shares of Anglo American are currently down 0.5 percent at 1,060 pence, while the STOXX Europe 600 Optimised Basic Resources index is down 0.2 percent.
Copyright (c) 2017 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.