ArcelorMittal (0RP9 – Research Report), the Basic Materials sector company, was revisited by a Wall Street analyst today. Analyst Ioannis Masvoulas from Morgan Stanley downgraded the rating on the stock to a Hold and gave it a €29.80 price target.
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Ioannis Masvoulas has given his Hold rating due to a combination of factors. While there is optimism around a potential peace deal between Russia and Ukraine, and ArcelorMittal stands to benefit from the reconstruction efforts in Ukraine, the recent rapid increase in stock price does not proportionately reflect the actual earnings potential from these developments.
Additionally, although the European steel industry fundamentals are improving and ArcelorMittal is well-positioned with a strong capital allocation and exposure to key markets, the near-term risk-reward scenario has become balanced. The analyst prefers to maintain a neutral position until there is more clarity on US tariffs and ongoing European policy reviews, considering that the stock’s re-rating has been ahead of its fundamentals.
In another report released on February 6, CFRA also maintained a Hold rating on the stock with a €26.00 price target.
Based on the recent corporate insider activity of 6 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of 0RP9 in relation to earlier this year.