Pennon looks fair value, says Deutsche Bank
By Michele Maatouk
Date: Tuesday 13 Nov 2018
(Sharecast News) - Pennon Group shares now look fair value, said Deutsche Bank on Tuesday, as it downgraded its stance on the stock to 'hold' from 'buy'.
It noted that the shares have risen strongly since early April and are now trading at the bank's 780p target price.
"With political risks around Brexit potentially culminating in the coming days, we downgrade to hold," it said, adding that the risk-reward trade-off for the stock is more balanced, with it trading roughly half way between DB's RAB nationalisation bear case and a bull case where political risks fade.
"Although it has a post review regulatory earnings yield slightly above the peer group average, it no longer stands out, in our view," the bank said.
The downgrade means that United Utilities is now Deutsche's only 'buy' rating in the UK water sector.
At 0955 GMT, the shares were down 3% to 757.80p.
Email this article to a friend
or share it with one of these popular networks:
You are here: news
10 Lower Thames St,
London EC3R 6EN