Ashland ( NYSE: ASH ) on Thursday was downgraded to Underweight from an investment rating of Neutral by analysts at JPMorgan. They said the maker of specialty chemicals faces challenges as customers reduce inventories and demand weakens in segments of the European and Chinese markets.
The bank pointed to a 37% rise in Ashland’s ( ASH ) inventories to $724 million in fiscal Q1 2023 from $530 million a year earlier, while sales advanced by only 2.5%.
“Ashland ( ASH ) may decrease production rates to lower its inventory values, which can weigh on profits,” according to JPMorgan.
Ashland ( ASH ) this week reported results that showed a 3% gain in sales from a year earlier to $525 million for the quarter ended in December. Adjusted EPS of $0.97 was greater than the consensus estimate of $0.94.
The company's stock rose 13% in the 12-month period through February 1, compared with a 1% gain for the Standard & Poor's 400 midcap stock index ( SP400 ).
For further details see:
Ashland downgraded to Underweight by JPMorgan on weaker demand