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Advisory article

KGHM copper suffers downgrade to 'sell', target price cut to PLN 110

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Copper giant KGHM was downgraded to 'sell' with target price cut to PLN 110 from PLN 133 by DM BZ WBK analysts in a report dated April 27.

 

"We see no changes to the business model of KGHM, with the exception of a slow deterioration in KGHM International," the analysts wrote. "However, zloty-denominated copper prices fell recently from some PLN25k/t to current PLN22k/t,

which results in a double-digit cut to our EBITDA forecasts in the market prices-based model."

 

"KGHM could react positively to either the zloty weakening or a copper price rally (seen as risks to our call), but today the company seemingly lost its DCF- or peer-based appeal," the brokerage believes.

 

KGHM shares were at PLN 122.1 when the report was prepared versus PLN 122.85 on Friday at 09:24 local time.

 

 

2017-04-28



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