September 25 (SeeNews) - Raiffeisen Capital & Investment (RCI) said on Friday it downgraded to ‘Hold’ from ‘Buy’ its recommendation for Romania's Alumil Rom Industry and raised its target price on the stock to 2.30 lei ($0.8/0.5 euro) from 2.20 lei.
“As Alumil stock increased by more than 20% over the last two weeks we decided to update our 12-m target price and recommendation. Our 12-m target price is derived by using a mix of fundamental and relative valuation. We see no reasons or triggers for an adjustment of our forecasts," RCI said.
"Thus, we updated our peer group and based on an average between 2010e P/E [price-to-earnings ratio] and 2010e EV/EBITDA [enterprise value/earnings before interest, taxes, depreciation and amortization] multiples we obtain an implied 12-m target price of 2.44."
RCI added that it kept its previous update approach, equal weight of DCF [discount cash flow] and relative valuations, and obtained a 12-month target price of 2.3 lei, which including 2009 estimated dividends indicates a 16% upside potential from the last closing price, on September 24.
"Hence, we decided to downgrade our recommendation for Alumil Rom Industry stock to Hold from Buy,” RCI said.
Shares in Alumil Rom Industry was trading 2.35% down at 2.08 lei by 1134 GMT on Friday on the Bucharest Stock Exchange.
Alumil Rom Industry (www.alumil.ro), set up in 1997, is a unit of Greek aluminium processing group Alumil Mylonas.
(1 euro=4.2015 Romanian lei)