Holmen AB, the supplier of pink paper for the Financial Times, dropped the most in almost a month in Stockholm trading after Nordea Bank AB said earnings growth may remain muted and downgraded its rating on the stock.
The shares slipped as much as 5.5 kronor, or 2.8 percent, to 189.5 kronor, their biggest intraday drop since Jan. 10. The stock fell 2.4 percent at 11:31 a.m. local time, with volumes at 47 percent of the daily average in the past three months.
Holmen yesterday reported fourth-quarter profit that missed analysts’ expectations as European demand for newsprint decreased and the strong krona sapped earnings. Net income fell to 902 million kronor ($142 million) from 2.94 billion kronor a year earlier and compared with an average analyst estimate of 1.13 billion kronor. Nordea today cut its rating on the share to sell from hold and lowered its price target to 190 kronor from 195 kronor.
“Holmen’s earnings will rebound from the fourth-quarter dip, but the momentum is likely to remain muted,” Harri Taittonen, an analyst at Nordea in Helsinki, wrote in a note today. “The share has been holding up better than that of the main peers, and the valuation premium appears demanding.”
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