Merrill Lynch said it upgraded its intermediate-term rating on French glassmaker Saint-Gobain to “buy” from “neutral” while keeping a long-term “accumulate” rating on the stock.
In a research note, …
Merrill Lynch said it upgraded its intermediate-term rating on French glassmaker Saint-Gobain to “buy” from “neutral” while keeping a long-term “accumulate” rating on the stock. In a research note, analysts at Merrill said they also raised their 12-month price objective on the stock to Euros 230 after the company announced the planned sale of its stake in optical equipment maker Essilor and raised its 2000 earnings-growth forecast to 20% from 15%. They said Saint-Gobain was trading on a 40% discount to the rest of the French market, excluding technical, media and telecom stocks – versus a more normal 20%. “On 10 times forecast 2000 earnings per share (pre-goodwill), we believe Saint-Gobain is cheap but, more importantly, the increased focus post-Essilor and the buyback provide the catalyst to renew market interest in the stock,” the note said.