Citi downgrade Sigma
April 16, 2010
Citi has downgraded Sigma Pharmaceuticals (SIP) (SELL, price target $0.47), following the resignation of Elmo de Alwis has CEO of the company.
Citi also maligned Sigma for its ‘more of the same’ business strategy which has led the company fortunes lower (in 2005 Sigma was trading at over $3.00).
The final straw for Citi, prompting the downgrade to ‘sell’, was the company’s 15% share price rally.
”Given the debt-related risks, requirement for asset sales and the lack of any clear strategy to turn the business around, we remain wary and would require a very significant discount to view it more favourably,” Citi said.
Citi also maligned Sigma for its ‘more of the same’ business strategy which has led the company fortunes lower (in 2005 Sigma was trading at over $3.00).
The final straw for Citi, prompting the downgrade to ‘sell’, was the company’s 15% share price rally.
”Given the debt-related risks, requirement for asset sales and the lack of any clear strategy to turn the business around, we remain wary and would require a very significant discount to view it more favourably,” Citi said.
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