New Britain Palm Oil (LON:NBPO) has been oversold following a 43% drop in the value of the stock over the past three months, according to Liberum Capital.
Restating its ‘buy’ advice following today’s market update, which revealed a 12% fall in quarterly sales, the City broker also repeated its ultra-bullish 750 pence a share price target.
At 9am the shares were trading 485 pence, down 15 pence or 3% after the quarterly figures.
This prompted Liberum to make an earnings downgrade for full-year 2012 to 37 cents a share from 43 cents.
However it added: “We believe palm oil prices are oversold and see New Britain shares as a geared play on palm oil prices.
“We acknowledge the shares may remain depressed until such a recovery in the commodity price is seen and that this may take until the first half of 2013.”