Raiffeisen analysts have upgraded the recommendation for OMV Petrom shares to “buy” from the previous “hold” and raised the target price to 0.4 RON/share, from 0.375 RON.
Yesterday Petrom shares traded at 0.327 RON/share, resulting in
a 20% growth potential considering the price estimated by
Raiffeisen.
The modification of the recommendation comes after Petrom reported
results above expectations, with the company’s net profit climbing
to 710 million RON, compared with a 10 million-euro net profit in
the April-June period of 2009. An average of analysts’ market
estimates pointed to a 633 million-RON net profit in the second
quarter of the year.
“Petrom reported results that were a positive surprise. The
management was able to reduce losses, especially in the refining
segment, albeit at the cost of lower capacity utilisation and
output. We assumed the stop-and-go strategy at Arpechim would not
have such a big positive impact. Improving margins may be a
singular event, as product supply was restricted due to maintenance
shutdowns of several plants in the region,” say Raiffeisen
analysts.
Petrom managed to reduce losses to 4.1 million RON between April
and June of 2010, from a 322.8 million-RON loss in the same period
of last year.