Deutsche Bank Upgrades Mechel (MTL) to Hold
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Price: $2.25 --0%
Rating Summary:
2 Buy, 4 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 11 | New: 13
Rating Summary:
2 Buy, 4 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 11 | New: 13
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Deutsche Bank upgraded Mechel (NYSE: MTL) from Sell to Hold.
The firm comments, "With the stock trading at c.USD6.0/ADS, we have started getting calls on Mechel again. Investors are generally interested in three things: 1) the margin of safety; 2) what the current valuation implies; and, 3) what can turn the stock around."
"We believe Mechel could unlock value by: 1) selling some of its "liquid" assets; 2) shutting down its European operations (Romania); and, 3) maximizing the value of the Mechel-Mining stake. The complete closure of its Romanian assets (generates negative USD1.2bn NPV) should unlock the most immediate value for shareholders (+50% to our valuation). The asset sale program (MSG, Voskhod and Toploficatsia Rousse) could realize at least USD383m (our NPV est.), while private placement of the non-controlling stake in Mechel-Mining (up to 25%) may be realized at a premium to our valuation estimate, if management trades off some long-term benefits to the firm for short-term cash needs (off-take agreement + price discounts)."
For an analyst ratings summary and ratings history on Mechel click here. For more ratings news on Mechel click here.
Shares of Mechel closed at $5.96 yesterday.
The firm comments, "With the stock trading at c.USD6.0/ADS, we have started getting calls on Mechel again. Investors are generally interested in three things: 1) the margin of safety; 2) what the current valuation implies; and, 3) what can turn the stock around."
"We believe Mechel could unlock value by: 1) selling some of its "liquid" assets; 2) shutting down its European operations (Romania); and, 3) maximizing the value of the Mechel-Mining stake. The complete closure of its Romanian assets (generates negative USD1.2bn NPV) should unlock the most immediate value for shareholders (+50% to our valuation). The asset sale program (MSG, Voskhod and Toploficatsia Rousse) could realize at least USD383m (our NPV est.), while private placement of the non-controlling stake in Mechel-Mining (up to 25%) may be realized at a premium to our valuation estimate, if management trades off some long-term benefits to the firm for short-term cash needs (off-take agreement + price discounts)."
For an analyst ratings summary and ratings history on Mechel click here. For more ratings news on Mechel click here.
Shares of Mechel closed at $5.96 yesterday.
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