Qiwi Sinks On Downgrade, Dire Russian Economy News

Qiwi PLC QIWI shares were sharply lower Friday in the wake of a fourth-quarter earnings miss and a dire forecast for Russia's economic growth.

Susquehanna's Meghna Ladha downgraded the Russia-based e-commerce and financial services company to Neutral, citing economic uncertainty in its primary market.

Qiwi changed hands recently down nearly 6 percent at $20.92.

On Friday, Russia's central bank predicted the Russian economy will shrink in 2015 by 3.5 percent to 4 percent, compared with its forecast earlier this year calling for a 3 percent contraction.

"We're moving to the sidelines," said Ladha, who slashed her price target on Qiwi more than 50 percent to $20.

Qiwi in Thursday said it lacked "enough visibility" concerning the Russian economic outlook to offer a reliable 2015 earnings forecast.

Qiwi nonetheless predicted earnings growth for the company between 12 percent and 16 percent.

If Russia's economy stabilizes, Ladha said Qiwi is "an undervalued asset."

Qiwi's latest earnings forecast, however, is below Ladha's earlier prediction of 20 percent earnings growth.

Ladha said the company's latest outlook "suggests 2015 will be an investment year" for Qiwi.