Broker snap: Goldman downgrades DS Smith after strong run

5th Jun 2013 11:01

Goldman Sachs has cut its recommendation for packaging company DS Smith from 'buy' to 'neutral' following stock's recent share price run.The broker has made no changes to its estimates and remains positive on the company's "opportunity to improve the returns profile". This follows its targeted synergies related to the SCA Packaging acquisition and the company's focus on lowering container-board exposure versus corrugated exposure.Goldman said: "We continue to view favourably DS Smith's top-quartile CROCI and strong industry positioning within the European paper and packaging sector. "However, following a period of outperformance, we currently see upside of 15% to our six-month target price of 278p, which is in line with the median upside of 13% in our mid-cap coverage currently."Since the broker rated DS Smith on March 1st 2012, the stock has gained 39%, compared with the wider FTSE World Europe index which has risen just 13.2%.The share price was down 1.62% at 237.2p by 10:52.