WestRock Company ( NYSE: WRK ) was cut to Hold from a prior Buy at Argus after Q1 earnings missed expectations earlier in the month.
The Atlanta-based company posted a wider than expected loss in the earnings report and withdrew full-year guidance . The stock’s steep slide following the results was warranted in Argus’ view.
“Based on the weak 1Q results and withdrawn guidance, we are lowering our EPS estimates for both this year and next, and believe that a Hold rating is now appropriate,” the firm’s analysts wrote on Monday. “We believe that the relatively low multiples are warranted based on the company’s current prospects.”
A $36 price target was assigned to the stock alongside the downgrade. Nonetheless, the firm indicated that the stock’s long-term prospects appear positive, leaving the company Buy-rated on a five-year timeline despite the Hold rating on a 12-month basis.
Read the transcript of the company’s latest earnings call .
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Argus cuts WestRock to Hold after earnings disappointment