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Investing.com - Goldman Sachs downgraded Yaskawa Electric (6506:JP) (OTC:YASKY) from Buy to Neutral on Tuesday, while lowering its price target to JPY3,000.00 from JPY3,700.00.
The investment bank cited the lack of recovery in growth driven by new inverters and servo motors, as well as North America’s failure to replace China as a growth driver for the Japanese automation equipment manufacturer.
Goldman Sachs noted that Yaskawa’s capital returns, which were previously above the industry average, have been gradually declining, with the stock’s market valuation falling to more moderate levels.
The new price target implies a 6% upside potential, compared to the 16% average upside for Goldman’s Japan machinery coverage, which contributed to the downgrade decision.
Since being added to Goldman’s Buy list on January 4, 2021, Yaskawa shares have fallen 45% compared to a 57% gain for the TOPIX index, with a 53% decline over the past 12 months versus a 3% drop for the broader market.
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