Unilever PLC (LON:ULVR) was a FTSE 100 faller after a downgrade by a leading team of City analysts ahead of the consumer products giant's fourth-quarter rersults, due this Friday.
Barclays Capital chopped its recommendation on the Anglo-Dutch firm to ‘equal-weight’ from ‘overweight’ as it said there was “optionality and scope for positive catalysts” elsewhere in the sector.
In other words, Unilever isn’t as sexy as some of its rivals.
In a note to clients, Barclays said: “We see no reason why the increasingly agile Unilever should not continue to operate effectively, combining market share gains across the majority of its businesses with solid margin improvement.
“However, a combination of recent sector outperformance (possibly on the back of the group’s new ambitious margin targets outlined in November), emerging market trading and currency uncertainty, together with the need to take wider price increases to recover oil related input cost inflation all warrant a more near term cautious stance.”
At 8.25am, shares in the company were changing hands for £33.08, down 1.6%.
Of the 12 analyst teams logged as following Unilever, seven are ‘buyers’ of the stock and only two have ‘sell’ recommendations. The remainder agree with Barclays and think the shares are fully valued.