ABB: Oddo downgrades rating and outlook

(CercleFinance.com) - Oddo has downgraded its rating on the ABB share to Reduce (vs.
Neutral), although sticks to its target price of 18 Swiss francs after reviewing its outlook.

Oddo has reduced its forecasts to integrate a deterioration in economic conditions. The broker says that after recalculating the outlook for the group's four new divisions, it has cut its 2019 and 2020 estimates by 4% to 5%, particularly expecting lower organic growth in a context that is tending to deteriorate progressively, which also penalises the group's margins.

Oddo has downgraded its recommendation on the stock for several reasons: 1/ the transition phase is fairly long and carries the execution risks with it; 2/ the economic situation could penalise the group more; 3/ the share seems expensive in its sector; 4/ it concludes with a new estimated valuation of 18.0 Swiss francs.


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