HLBZF - Morgan Stanley downgrades CRH after reviewing cement/aggregates industry
Juan-Enrique/iStock via Getty Images CRH (CRH) slips nearly 1% premarket to $52/share after Morgan Stanley downgraded the stock to Equal Weight from Overweight, seeing more value elsewhere. "CRH has many positives: 1) cashflow, 2) a track record of creating value via M&A, 3) buybacks, 4) exposure o U.S. infrastructure, 5) growing building products business which supports cash conversion," wrote analyst led by analyst Cedar Ekblom. "Yet we think the shares are fairly valued priced at an average 5.6% FY21/22e FCFY. Granted, U.S. pure play aggregates peers trade on 3.2%, yet we see no catalyst for CRH to rerate; it appears committed to its European footprint." Morgan Stanley also prefers cement over aggregates, keeping HeidelbergCement (HLBZF) at Overweight and Holcim (HCMLF) as a top pick. Taking a different stance, Citigroup upgraded CRH last month, saying the stock was poised to benefit from U.S. infrastructure theme.
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Morgan Stanley downgrades CRH after reviewing cement/aggregates industry