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UPDATE: Bank of America Downgrades ArcelorMittal to Neutral on Rights Issue Risks

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Bank of America reduced its rating on ArcelorMittal (NYSE: MT) from Buy to Neutral on the potential of a downgrade to sub-IG on shares.

Bank of America noted, "We downgrade ArcelorMittal stock to Neutral from Buy on the increasing risk of a rights issue towards year end. We estimate that a downgrade to sub-IG would be -3% dilutive for equity shareholders due to the incremental interest costs associated with step-up clauses on debt. If MT were to maintain its IG rating by doing a rights issue for c$5bn, it would be -11% dilutive to EPS in 2013."

ArcelorMittal closed at $15.95 on Wednesday.

Latest Ratings for MT

DateFirmActionFromTo
Sep 2014Credit SuisseUpgradesNeutralOutperform
Sep 2014MacquarieDowngradesOutperformNeutral
Aug 2014Exane BNP ParibasUpgradesUnderperformNeutral

View More Analyst Ratings for MT
View the Latest Analyst Ratings

Posted-In: Bank of AmericaAnalyst Color Downgrades Intraday Update Analyst Ratings

 

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