Exane BNP Paribas has deflated shares in oil, gas and mining focused pumps maker Weir Group PLC (LON:WEIR) after downgrading its rating to ‘neutral’ from ‘outperform’.
In a note to clients, the French bank’s analysts said: “In the context of market share worries, we believe the risk/reward is not attractive enough to remain buyers (of Weir)”.
READ: Weir to cut ties with industrial pumps as it focuses on oil and mining
They added: “Having moved to model a new build cycle materialising in 2019 rather than 2018, and only a limited pricing recovery which is partly absorbed by wage inflation, we are now just 8% ahead of consensus EBIT19e for Weir’s O&G division.”
The analysts also cut their target price for Weir Group by 4% to 2,300p, with the stock trading at 2,244p in lunchtime trading, down almost 3.5% on Tuesday’s close.
However, in the same note, Exane’s analysts raised their target price for oil services engineering rival Rotork PLC (LON:ROR) by 8% to 390p and repeated an ‘outperform’ rating on the stock.
The analysts pointed out that “large upcoming increases in US pipeline capacity should benefit Rotork; our conversations at OTC 2018 point to improved downstream demand.”
Rotork shares were trading at 352.4p at lunchtime, down 0.7%.