Gol Linhas downgraded to Sell from Neutral at Citi

Citi downgraded Gol Linhas to Sell from Neutral with a price target of $3, down from $3.30. The company’s latest financial statements show higher than expected, post-conversion net debt, with less cash in hand after all warrants are exercised, the analyst tells investors in a research note. As a result, Gol’s equity value looks even more compressed after full dilution versus what Citi had anticipated. The firm says the recent shared rally appears related to a “short squeeze and not a fundamental bounce.” As such, Citi is making a “tactical move” to downgrade.