Computershare tumbles on Citi downgrade
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The news: Shares in Computershare extended recent losses in morning trade on the ASX as the share registry firm suffered another downgrade.
The numbers: Shares lowered 1.9% to $33.55 by 11:55am AEDT, making it the third worst performing ASX 200 company.
Citi downgraded its rating on the stock from 'buy' to 'neutral' and lifted its target price from $30 to $35.
The context: Citi noted the company's share price has climbed sharply in recent months, buoyed by favourable interest rate movements.
However, Citi's analysts do not see "material further advance" in the stock, despite the completion of two recent acquisitions that will likely improve margin income, as well as balance sheet capacity for further acquisitions and ongoing share buybacks.
The downgrade follows similar moves from UBS and Morgans this month.
What they said: "Consensus seems to be moving Computershare from 'buy' to 'neutral' and, for the moment we, somewhat reluctantly, join the chorus," said Citi analysts.
"The stock has rallied strongly and although we see sources of potential further upside, these are currently uncertain enough to prevent us from confidently predicting material further advance."
The source: Citi research
