Bear of the Day: France Telecom - ADS (FTE)
by Zacks Equity ResearchDecember 11, 2012 | Comments : 0 Recommended this article: (0)
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Looking ahead, we expect the shares of the company to remain under pressure, owing to increased VAT rates, a persistent unfavorable economic environment, a poor fixed-line telephony business, lower mobile termination rates and strict regulatory measures across key European markets. Thus, the absence of any near-term strong driving catalyst compels us to have an apprehensive outlook on the company.
Hence, we downgrade our recommendation to Underperform from Neutral. The company has a price target of $9.75, based on 6.3x our 2012 EPADS estimate.
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