GSK: Jefferies downgrades stock
(CercleFinance.com) - On Thursday Jefferies downgraded its rating on GSK shares from "buy" to "hold", slashing its corresponding target price from 2,100 pence to 1,475 pence (current price about 1,329 pence, down 1%).
In a study of the European pharmaceutical sector, the US broker says that it considers the pharmaceutical company to be the most exposed to the Zantac case, named after the heartburn drug that is the subject of many complaints in the US.
According to Jefferies, the case could cost the group between one and seven billion dollars, which means that the 20% drop in the company's value in August already includes the "worst case" scenario.
However, even after this correction, the broker expects that some uncertainty will continue to weigh on the stock in the next few months.
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