On Tuesday, UBS has downgraded shares of chemical company Chemours (NYSE:CC) from Buy to Neutral, significantly lowering the price target to $21 from the previous $37. This adjustment comes amid ongoing internal investigations and leadership changes at the company, which have raised concerns about potential impacts on the stock's performance.
The downgrade follows recent events at Chemours, including the removal of the CEO and CFO, which UBS believes could weigh heavily on the company's shares. The firm acknowledges the difficulty in assessing the full scope of these issues, citing a lack of sufficient information to gauge the cultural and financial ramifications.
Despite the downgrade, UBS maintains a positive outlook on the core aspects of Chemours' business, including the production of titanium dioxide (TiO2), advanced materials, and refrigerants. However, the analyst has expressed concerns over the preliminary net income figures, which appeared to fall short of market expectations.
UBS has also revised its EBITDA estimates for the fiscal years 2024 and 2025, reducing them by 5-6% to $1.14 billion and $1.37 billion, respectively. This revision is attributed to a weaker base established by the preliminary results for the fourth quarter of 2023 and the potential for business disruptions caused by the current internal challenges at Chemours.
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