Soriana Falls After Citigroup Forecasts Declining Margins
Organizacion Soriana SAB (SORIANAB), Mexico’s second-largest retailer, fell the most in a week in Mexico City trading after Citigroup Inc. forecast declining profit margins.
Soriana slid 2.4 percent to 27.57 pesos at 2:37 p.m. New York time.
Mexican retailers such as Soriana and Controladora Comercial Mexicana SAB (COMERUBC), or Comerci, are facing a “recessive environment” in the coming months, with “very weak” indicators such as same- store sales, Eduardo Estrada Lopez wrote in a note to clients today.
“We foresee substantial declines in the gross margins of Soriana and Comerci during 4Q08, as they have clearly placed a priority on increasing revenue,” Lopez wrote.
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