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Macquarie downgrades stance on ITV, believes broadcaster will fall "victim to politics"

Macquarie has gone to ‘neutral’ from ‘outperform’ on shares in the maker of Broadchurch and Coronation Street, which it reckons are worth 200p each
The Macquarie downgrade hit the ITV share price, which shed 1.7% at 181.75p in morning trade

ITV plc (LON:ITV) will fall victim to politics, according to the London arm of Aussie bank Macquarie, which has downgraded its rating for Britain’s largest independent broadcaster.

Macquarie has gone to ‘neutral’ from ‘outperform’ on shares in the maker of Broadchurch and Coronation Street, which it reckons are worth 200p each.

Analyst Giasone Salati said Brexit - whether it be the soft or hard variety - and the uncertainty created by last week’s UK election result are already starting to affect consumer and business confidence.

READ: ITV expects first half ad revenue to fall without football tournament this summer

The impact of the weak pound, which buoyed sentiment among the exporters, is starting to wear off, he added.

The net impact of an anticipated slowdown of the UK economy will be to reduce the amount spent on television advertising, which is still ITV’s bread and butter.

“In short, the balance of risk has sharply moved to the downside for advertising spending,” said Salati, although he thinks the company remains a “credible” bid target.

The Macquarie downgrade hit the ITV share price, which shed 1.7% at 181.75p in morning trade.

Of the 16 analysts logged as covering the stock by the Broker Forecasts site, five have ‘buy recommendations’, two are ‘sellers’, while the remainder think it is fully valued. The consensus price target is 224p.

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