- Cabot (CBT -2.9%) is downgraded to Neutral from Overweight with a $47 price target at J.P. Morgan after the stock has jumped 18% YTD, which the firm says probably is not related to any fundamental positive changes in CBT's business conditions.
- JPM says it is lowering its 2016 free cash flow estimate to $2.86/share from $3.30 to reflect reduced expectations for changes in working capital, given the recovery in Brent crude oil prices which is expected to lead to higher inventory values.
- The firm says it does not view CBT as overvalued, given that it is capable of generating a ~6% free cash flow yield in 2016, but higher free cash flow yields can be captured with shares of Minerals Technologies (MTX -0.1%) or Orion Engineered Carbons (OEC +1.1%).
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Earlier: Cabot names Keohane as new CEO after Provost steps down