logo-loader
viewAshmore Group

Citi downgrades Ashmore Group to 'sell', says price not right

share_price_down350_5037a1719033c.jpg

Citi today advised investors to sell shares in Ashmore group (LON:ASHM), saying shares in the emerging markets focused investment to continue to underperform.

The broker also replaced Schroders (LON:SDRC) with Ashmore as its least preferred asset management stock.

Analyst Haley Tam said in a note titled "The price is not right" that the emerging market bond fund industry matures and investors are starting to rely more on performance track records for allocation decisions.

Her analysis suggests that key Ashmore funds have underperformed over one and five years and as three year returns are better, “quantum of outperformance is small”.

“Modest EM Debt fund flows at Ashmore are in contrast to industry data that suggests H1 calendar 2012 has been a strong period for EM bond fund flows,” said Tam.

“Ashmore appears to be missing out on these trends.”

Tam expects Ashmore’s pre-tax profits to drop five percent this year and next, while earnings per share are set to decline 11 percent this year and five percent in 2013.

Citi downgraded its recommendation on Ashmore to ‘sell’ from ‘neutral’, while also lowering its target price to 300 pence per share from 305 pence previously.

Ashmore fell 4.5 percent to 331.5 pence following the downgrade, which made it the heaviest faller in the FTSE 100 index.

Quick facts: Ashmore Group

Price: 447.4 GBX

LSE:ASHM
Market: LSE
Market Cap: £3.19 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Arizona Silver Exploration will be going back to Philadelphia after drilling...

Arizona Silver Exploration (TSXV: AZS) (OTCQB: AZASF) VP of Exploration Greg Hahn joined Steve Darling from Proactive with some results from the company’s drill program at their Philadelphia project. Hahn discusses the next step the company is planning. Hahn also told Proactive they are...

10 hours, 56 minutes ago

2 min read