BFFAF - BASF cut to Hold at Stifel on considerable risk from current macro trends

BASF's (OTCQX:BASFY) valuation suggests there could be upside for investors, but macroeconomic and political risks persist, Stifel said Wednesday in downgrading shares to Hold from Buy and slashing its price target to €63 from €83. BASF reported better than expected Q1 preliminary EBIT of €2.8B, beating €2.4B analyst consensus and already achieving ~40% of the full-year outlook, but despite an attractive dividend yield, BASF has considerable bias to current macro trends, is energy intensive and highly exposed to Russia, Stifel said. BASF said it would take a €1.1B hit from a Wintershall Dea loan to Nord Stream 2, and there might be more to come in the event of further sanctions on Russian gas, with a risk of energy shortages if Russia moves to slow supply, which would considerably hurt profits if BASF's main Ludgwigshafen site curtailed production, Stifel said. Supported by inventory building as rising inflation comes into play,

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BASF cut to Hold at Stifel on considerable risk from current macro trends