UPDATE: Piper Jaffray Downgrades Ceres to Neutral, Lowers PT Following Sweet Sorghum Commercial Ramp Delay

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In a report published Friday, Piper Jaffray analyst Michael E. Cox downgraded the rating on
CeresCERE
from Overweight to Neutral, and lowered the price target from $5.00 to $3.00. In the report, Piper Jaffray noted, “We are downgrading shares of CERE from Overweight to Neutral after management cautioned that the commercial ramp of sweet sorghum in Brazil is likely to fall below expectations this year. This serves to push out the stock's primary catalyst by a year. In releasing 3Q results which included a $9mil loss, management stated that despite a sharp increase in average yields that wide variability in yields across locations will likely curtail adoption next season. Pushing out the commercial adoption timeline by a year will serve to fuel investor concerns around Ceres cash position, which at the recent run-rate would only provide 4+ quarters of cash. We believe shares will likely trade sideways until management provides greater clarity on efforts to reduce the cash burn or visibility on seed adoption improves.” Ceres closed on Thursday at $3.25.
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Posted In: Analyst ColorDowngradesAnalyst RatingsMichael E. CoxPiper Jaffray
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