The broker, which now rates the Russian gold producer a ‘sell’, made the move after a recent rally in the share price, which it believes is unwarranted.
The company’s first-half results saw the shares slide as they reflected the lower gold price environment of 2013.
It reported a net loss of US$255mln, missing analyst forecasts, with write-downs of US$305mln in the period.
“Polymetal’s share price has risen by 40% since June and we have found it increasingly difficult to justify the higher prices,” said analyst Jon Bergtheil.
As well as a move from ‘neutral’ to ‘sell’, he also drops his target price for the shares from £6.98 to £6.12.
The shares added 2% to 744.8p on Friday.