B&M European Value Retail SA (LON:BME) dropped on Tuesday following a downgrade to ‘hold’ from ‘buy’ by Shore Capital over coronavirus ‘fog’.
Analysts kept the 357p price target but expressed concern for uncertainty hitting the wider market for low-value consumer goods.
READ: B&M European Value weak as JPMorgan Cazenove cuts to ‘neutral’; thinks earnings at risk due to slowing momentum
The FTSE 250-listed retailer may “be subject to not only supply chain disruption, in terms of the free flow of products, but also the potential and costly adjustment to its supply base,” analysts said in a note.
“Until the stock market has visibility on such matters, we struggle to see how the B&M share price can outperform the retail equity market, with the risks on the downside, perhaps.”
Shares dropped 3% to 346.3p on Tuesday morning.