Bill Gross warns on gold momentum as regional bank stocks tumble
Investing.com - Morgan Stanley downgraded Aurubis AG (OTC:AIAGF) from Equalweight to Underweight on Friday, while lowering its price target to EUR95.00 from EUR98.00.
The downgrade comes as Morgan Stanley sees a mixed outlook for Aurubis’s fiscal years 2025 and 2026, with tailwinds from free metal gains and record copper premiums being partially offset by hedging, weaker scrap recovery charges, softer treatment and refining charges, and foreign exchange headwinds.
The investment bank noted that broader mining-exposed equities appear more compelling, with intensifying supply stress, a softer U.S. dollar, and macro uncertainty supporting commodity prices, which could lead to double-digit mark-to-market upgrades compared to just 5% for Aurubis.
Morgan Stanley expressed caution about Aurubis’s recycling growth, describing it as a "show-me story" despite significant investment representing over 80% of the company’s €1.7 billion strategic capital expenditure planned for 2021-2027.
The firm highlighted concerns about the flagship Richmond project, which is expected to drive over 65% of Aurubis’s targeted EBITDA uplift but faces execution risks, leading Morgan Stanley to project that the group’s return on capital employed will trail peers over the next four years.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.