In what could be described as an analyst upgrade that has caught the attention of the stock market, Braskem (NYSE:BAK) received a buy rating from UBS Group. The Fly reports that in a note to investors on Friday, analysts at UBS upgraded Braskem’s rating from neutral to buy. While the reasons for this upgrade remained undisclosed in the report, emphasis was placed on how institutional investors have either increased or reduced their stakes in the chemical company.
Advisor Group Holdings Inc., for example, expanded their holdings by 156.6% during Q1 2021 and Shilanski & Associates purchased new shares of Braskem valued at over $488,000 in Q4 2020. Atlas Capital Advisors LLC, another institutional investor, saw an increase of 85.9% during Q4 of last year and Bank of America Corp DE lifted its stake by 55.0%, valued at over $162,000 during Q1 this year. Finally, UBS Group AG reported a massive increase of over 1,640% during Q3 last year with regards to their holding of Braskem.
For those who may not know much about Braskem or are unaware of its significance within its industry space, it is a major petrochemical company that is said to be one of Brazil’s largest producers and suppliers based on revenue. Serving industries such as chemicals and plastics, among others, it has been instrumental in various pursuits over the years such as developing innovative solutions for sustainability.
This recent upgrade by UBS Group indicates improved prospects for Braskem whose stock closed relatively low on Thursday following several months of substantially stable trading sessions despite global uncertainty caused by the pandemic and geopolitical developments around the world. This unexpected rating might signal better times ahead for Braskem; however only time will tell whether this move was wise or not given how unpredicatable today’s market can be.
Braskem SA Remains Strong in Challenging Market as Citigroup Upgrades Rating to ‘Buy’
Braskem SA is a leading global manufacturer of petrochemicals and other related products. With operations in Brazil, the USA, Europe and Mexico, the company offers a diverse range of chemicals, electricity and polypropylene products. Despite the challenging economic climate caused by the ongoing COVID-19 pandemic, Braskem remains a solid player in the market as evidenced by recent ratings upgrades from Citigroup.
On Tuesday, March 28th, Citigroup upgraded Braskem’s rating from “neutral” to “buy” in a report. This news was well received by Wall Street, indicating that investors have high hopes for the company’s growth prospects.
According to Bloomberg.com, one equities research analyst has rated Braskem’s stock with a sell rating while two have assigned it a hold rating. Three analysts have given the company their buy rating which shows that there is renewed interest in this stock despite current market conditions. The current consensus rating for Braskem is “Hold”.
NYSE:BAK opened at $8.27 on Friday with a market capitalization of $3.74 billion. The company has recorded a 12-month low of $6.26 and a 12-month high of $19.64 demonstrating its volatility in recent times. Notably, Braskem has been trading below its 200-day moving average price of $9.53 and its 50-day moving average price of $7.75 since Q4 2020.
Braskem SA operates with an enviable level of efficiency with a current ratio of 1.42 and quick ratio of 0.84 pointing towards strong liquidity levels which are even more impressive during periods such as these marked by economic uncertainty due to COVID-19 challenges.
In conclusion, Braskem SA continues to prove that it has what it takes to remain competitive even under challenging market conditions thanks to its efficient operations and diversification strategy across international markets. And now with Citigroup rating the stock as “buy”, investors should be on the lookout for potential growth opportunities in this vibrant global enterprise.