Quaker Chemical shares fall on lowered rating
NEW YORK (AP) — Shares of Quaker Chemical Corp. fell Tuesday after an analyst lowered his rating, noting that the share price had reached his fair value estimate.
THE SPARK: Janney Capital Markets analyst Liam D. Burke downgraded his rating on Quaker to "Neutral" from "Buy."
THE ANALYSIS: Quaker's stock ended Monday at $50.18 per share, which topped Burke's fair value estimate of $50 per share. But the analyst remained positive about the Conshohocken, Pa., chemicals manufacturer's revenue growth rate and free cash flow generation.
"The company's long-term outlook has not changed and Quaker is well-positioned for long-term growth," Burke told clients in a research note. "Although Quaker is seeing a mixed near-term outlook in its global end markets, the company's growth is not limited by the underlying annual production growth of steel."
Quaker has a diversified global platform that can serve manufacturing, steel and metalworking customers, he stated.
Burke said his valuation implied 2013 earnings per share of $3.82. That's identical to the 2013 forecast from analysts surveyed by FactSet.
THE SHARES: Quaker's shares fell $2.35, or 4.7 percent, to $47.83 in afternoon trading. The decline came a day after its shares rose to a 52-week high of $50.55 per share. They traded as low as $24.11 last October.