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Citi initiated coverage on Loma Negra Compania Industrial Argentina SA (NYSE:LOMA) with a buy rating and a $16.00 price target, citing potential for a multi-year cement demand recovery in Argentina. The target represents significant upside from the current price of $11.29, with InvestingPro data showing the stock trading at an attractive PEG ratio of 0.67.
The research firm noted that cement consumption per capita in Argentina has fallen to 205kg, the lowest level since 2005, which it views as an attractive entry point for investors. Cement demand is strongly correlated with macroeconomic performance, with a long-term GDP multiplier of 2.5x. For investors seeking deeper insights, InvestingPro offers additional exclusive tips and comprehensive analysis in its Pro Research Report.
Citi expects this relationship to drive "powerful earnings momentum" for the Argentine cement producer over the coming years. The firm also highlighted that unlike during its 2017 IPO period, Loma Negra currently faces no major capital expenditure commitments. With a market capitalization of $1.32 billion and a solid financial health score rated as GOOD by InvestingPro, the company operates with moderate debt levels and maintains healthy profit margins of 27%.
This lack of significant capital requirements positions the company as a "strong free cash flow to equity case," according to the research note. The analysis comes as Loma Negra shares have declined 18% from recent highs.
Citi assigned a "High Risk" designation alongside its buy rating for the stock, which it believes now offers "a good entry point" for investors looking to capitalize on the anticipated cement sector recovery.
In other recent news, Loma Negra Compañía Industrial Argentina SA has disclosed its financial results for the first quarter of 2025. The company filed its quarterly report with the U.S. Securities and Exchange Commission, although specific financial details were not provided in the available excerpt. Investors rely on such filings to evaluate the company’s financial health and make informed decisions. Additionally, Loma Negra has submitted its annual report on Form 20-F for the fiscal year ending December 31, 2024, which includes audited financial statements and management’s discussion of the fiscal year. This filing provides a comprehensive overview of the company’s financial performance and strategic direction.
In terms of analyst activity, Morgan Stanley (NYSE:MS) recently upgraded Loma Negra’s stock rating from Equalweight to Overweight, raising the price target to $15.00. The firm expressed confidence in Loma Negra’s market position and operational capabilities, anticipating a gradual recovery in demand. Similarly, BofA Securities upgraded the stock from Neutral to Buy, increasing the price target to $14.00. BofA cited positive macroeconomic developments and projected economic growth as factors influencing the upgrade. Both firms’ analyses reflect an optimistic outlook on Loma Negra’s potential in the Argentine cement market.
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