GCIShoreCap says NatWest entering fair value territory, downgrades
[Electric Egg Ltd. - stock.adobe.com]
Shore Capital downgraded on Monday to 'hold' from 'buy' as it said the shares were "entering fair value territory".
The broker noted that NatWest shares are up 46% year-to-date, significantly outperforming the FTSE All-Share Index up 8% and FTSE All-Share Banks Index up 18%.
"This has occurred despite the government reducing its shareholding from around 38% at the start of the year to circa 27% today, with more to come by way of a directed share buyback and possible discounted retail placing," it said.
"As a result of the re-rating, the stock is now trading at a slight premium to TNAV, while the upside to our 350p fair value is now just 9%.
"Consequently, we downgrade our recommendation to hold (from buy)."
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