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On Monday, Morgan Stanley (NYSE:MS) analysts initiated coverage on Gaztransport & Technigaz stock with an Underweight rating and set a price target of €145. The analysts cited several reasons for their cautious stance on the stock.
Despite Gaztransport & Technigaz’s position as a significant player in the LNG market, the analysts expressed concerns about the current consensus being overly optimistic. They noted the limited speculative activity in the current market environment as a factor influencing their decision.
The analysts acknowledged Gaztransport & Technigaz’s strong track record of stability in the LNG sector. However, they pointed out potential execution risks associated with the company’s new investment initiatives. They indicated a preference to observe further developments before assigning value to these opportunities.
The stock has risen by 30% year-to-date and is trading at 11.5 times EV/EBITDA, which is close to its historical average. The analysts expect an inflection point from peak earnings in 2027 and see approximately 14% downside to their price target, leading them to favor other names in the sector at this time.
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