SOUTH KOREA: Merrill Lynch downgrades Hyundai Motor shares
Merrill Lynch has downgraded Hyundai Motor Co. shares to 'neutral' from 'buy' in its latest report, citing adverse currency environment, rising raw material costs and a delayed domestic demand recovery, according to a CBSMarketwatch.com report.
The report cited Merrill Lynch as saying that South Korea's largest automaker is estimated to announce weaker earnings during the next few quarters - it has slashed Hyundai Motor's earnings per share forecast by 30% for 2005 and 24% for 2006.
"Although we are encouraged by HMC's topline momentum in key markets, our concern is on its margins. We advocate investors to stay on sidelines until tangible signs emerge on HMC successfully executing in key revenue/cost initiatives," Merrill Lynch's Mark Yoon said in his Tuesday report, CBSMarketwatch.com added.