Sainsbury: shares extend losses, brokers cut their ratings

(CercleFinance.com) - Shares in British retailer Sainsbury fell on Thursday, extending their losses from yesterday, after brokers downgraded their ratings on the stock.


Sainsbury's shares plunged 18.5% on Wednesday, after British antitrust regulators objected to its proposed takeover of Walmart's Asda.

This morning UBS downgraded its rating on the stock from "buy" to "neutral," having slashed its corresponding target price from 435 pence to 245 pence, while Berenberg cut its rating from "buy" to "hold," also reducing its target significantly (from 338 pence to 235 pence).

After the Competition and Markets Authority's (CMA)'s decision yesterday, Berenberg said it believes that Sainsbury's merger with Asda is unlikely to go ahead.

UBS shares this opinion too, judging that Sainsbury, as a standalone entity, is not in great shape organically.

The share is currently down 0.8% at 232.6 pence.

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