Goldman Sachs downgraded shares of Federal-Mogul (NASDAQ: FDML) from a neutral rating to a sell rating in a research note released on Friday morning. They currently have $5.00 price target on the stock, down from their previous price target of $9.00.
“With TTM net leverage of 4.6x (vs the sector average of 1.2x) FDML equity value is quite sensitive to changes in the EBITDA outlook which has worsened due to a more challenging volume, mix, and cost execution backdrop. We also see important FCF headwinds from restructuring needs and stepped up cash interest costs, which could lead to dilutive equity issuance. Our 6-month price target goes to $5 from $9, (with 38% downside vs. average sector upside of 13.1%) on our estimate revisions and as fundamental concerns leads us to lower our M&A probability rank to a 3 from a 1 previously.,” Goldman Sachs’ analyst commented.
Federal-Mogul traded down 1.01% on Friday, hitting $6.84. Federal-Mogul has a 1-year low of $6.87 and a 1-year high of $17.97. The stock’s 50-day moving average is currently $8.95. The company’s market cap is $676.5 million.
A number of other analysts have also recently weighed in on FDML. Analysts at Zacks downgraded shares of Federal-Mogul from a neutral rating to an underperform rating in a research note to investors on Wednesday, January 23rd. They now have a $7.80 price target on the stock.
One investment analyst has rated the stock with a buy rating, and two have issued a hold rating to the stock. The company currently has a consensus rating of overweight and an average price target of $9.00.
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