Barclays has decided to cut its share price prediction for Portugal’s struggling post office business from €3.80 to €3.00, heaping more misery on the company’s shareholders who have seen their investment decline 12.46% this year, 46% in 2017 and 27% in 2016. CTT shares fell further on the Lisbon stock exchange, in reaction to today’s Barclays downgrade, ending the session down 2.43% at €3.052, the lowest price since November 29, 2017.
Citing the uncertainty stemming from the company's muddled restructuring plan, Barclays decided to lower the shares target price and to revise its estimates of results and dividends.
The CTT restructuring plan, "has considerable uncertainty about its outcome at this stage," Barclays analysts said in a statement quoted by Bloomberg.
The CTT plan will cost €20 million this year. In March, the board announced that CTT closed 2017 with a profit of €27.3 million, the worst result since 2005.
However, CTT decided to pay a dividend of 38 cents per share, a move which cannot be sustained unless profits revive.
However, CTT decided to pay a dividend of 38 cents per share, a move which cannot be sustained unless profits revive.
The sale of CTT, under Pedro Passos Coelho's government, yielded over €900 million to the Treasury and was achieved in two stages: in December 2013, the State sold 70% of the company's shares at €5.52 a share, and in September 2014, sold the remaining 30% at €7.25 per share compared to today's €3.052.
