UPDATE: Deutsche Bank Downgrades Ferro Corporation to Hold; Valuation Post Bid is Fair

UPDATE: Deutsche Bank Downgrades Ferro Corporation to Hold; Valuation Post Bid is Fair

On Monday, Deutsche Bank downgraded Ferro Corporation (NYSE: FOE) from Buy to Hold with a $ 6.50 price target.

Deutsche Bank commented, “While the implied acquisition multiple of 7.0x ’13E EBITDA is below chemical peers of 7.9x ’13E EBITDA, we believe Ferro should be valued at a discount to its peers owing to lower margins (7.0% ’13E EBITDA margins vs best in class chemical margins of 20%-plus) and slower growth portfolio. Coupled with our belief that other strategic buyers are unlikely to bid owing to the lack of business overlap with Ferro, we assume Ferro will be acquired at or near the current share price (which is 5% above the $ 6.50 offer price).”

Ferro closed at $ 5.20 on Monday.

Tags: Deutsche Bank

Posted in: Analyst Color, Downgrades, Analyst Ratings


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5 thoughts on “UPDATE: Deutsche Bank Downgrades Ferro Corporation to Hold; Valuation Post Bid is Fair

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