- RBC Capital on Tuesday downgraded Equitable Holdings ( NYSE: EQH ) to Sector Perform from Outperform to reflect its valuation and near term macro headwinds associated with its AUM-based businesses.
- The research firm also cut its price target on Equitable ( EQH ) to $33 from $34, implying 6.3% potential upside to its last close, based on 1.1x 2023 BVPS ex-AOCI estimate.
- "We continue to believe Equitable ( EQH ) is a strong operator but view the premium valuation and lack of near term catalysts as signs that future performance will be more in line with peers after nearly five years of outperformance following its 2018 IPO and separation from Axa," analyst Mark Dwelle wrote in a note to clients.
- Dwelle added that the shares are "reasonably valued with reasonable earnings growth and capital return expectation discounted in the current valuation".
- RBC noted that the financial services firm's earnings declined significantly in 2022 relative to 2021 and it doesn't expect a full rebound till 2024.
- While Wall Street analysts on average rate Equitable ( EQH ) a Buy, SA Quant rates the stock Hold .
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RBC downgrades Equitable Holdings on valuation, macro headwinds