Scania AB (SCVB), the Swedish truckmaker controlled by Volkswagen AG, fell the most in more than a month in Stockholm trading as ABG Sundal Collier Holding ASA (ASC) advised clients to sell the shares because of worsening profit margins.
The shares fell as much as 4 percent to 133.8 kronor, their steepest intraday decline since July 22 and lowest price since Aug. 8. They fell 3.2 percent to 134.8 kronor as of 10:25 a.m. local time, valuing the Soedertaelje, Sweden-based company at 105.1 billion kronor ($16.1 billion). Trading volume was at 38.7 percent of the daily average in the past three months.
ABG lowered its rating on Scania shares to sell from hold today and cut its share-price estimate to 125 kronor from 145 kronor, citing a poor margin trend and negative currency effects. The broker cut its earnings per share estimates for 2014 and 2015 by 10 percent to 11 percent, it said.
“With slowing Brazilian demand growth and subsidy-related risks for a larger drop, potential reversal of recent significant market share gains, alarmingly weak profitability on additional volumes and continued drag from FX, we downgrade to sell,” Erik Golrang, Anders Idborg and Johan Edvardsson, analysts at ABG in Stockholm, said in a note to clients.
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