Barry Callebaut fell sharply on the stock market on Thursday in the wake of a downgrade by UBS, which said it was concerned about tensions on the global chocolate market.

The stock is currently losing 3.2%, falling to its lowest level since 2018.

In a note, UBS said it was taking a "more cautious" view of the stock, downgrading it from "buy" to "sell", with a price target lowered from 1,900 to 1,180 Swiss francs.

The study dwells on the recent surge in cocoa bean prices, against a backdrop of unfavorable weather, a factor which should be reflected in chocolate prices and penalize Barry's sales over the 2024-2025 period, according to the analyst.

With a PER of 18x, the share's valuation is however too stretched to support half-hearted growth and uncertain cash flow, judges the intermediary.

Copyright (c) 2024 CercleFinance.com. All rights reserved.