Ericsson: shares fall after Credit Suisse downgrade.
(CercleFinance.com) - Shares in Swedish mobile telecom equipment maker Ericsson are down over 2% on Tuesday after Credit Suisse downgraded the stock from "neutral" to "underperform.
"
The shares, listed on the Nasdaq Nordic market, were trading 2.7% lower at 45.6 Swedish kronor in late morning trading, while Stockholm's main stock index was up 0.4 percent.
"With Ericsson management looking to divest loss-making businesses and exit loss-making contracts at a time when the demand environment remains weak and FX headwinds are increasing, we believe that the top-line may continue to surprise on the downside," Credit Suisse said.
The brokerage firm expects sales to decline by 9%/7% in 2017/2018 before stabilising in 2019; consequently the broker has cut its target price for the share from 50 Swedish kronor to 38 Swedish kronor.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
"
The shares, listed on the Nasdaq Nordic market, were trading 2.7% lower at 45.6 Swedish kronor in late morning trading, while Stockholm's main stock index was up 0.4 percent.
"With Ericsson management looking to divest loss-making businesses and exit loss-making contracts at a time when the demand environment remains weak and FX headwinds are increasing, we believe that the top-line may continue to surprise on the downside," Credit Suisse said.
The brokerage firm expects sales to decline by 9%/7% in 2017/2018 before stabilising in 2019; consequently the broker has cut its target price for the share from 50 Swedish kronor to 38 Swedish kronor.
Copyright (c) 2017 CercleFinance.com. All rights reserved.