Evraz racks up healthy gains on Citi upgrade

11th Jan 2017 14:12

(ShareCast News) - Evraz - which owns vanadium and steel producing assets in South Africa and iron mining assets in Ukraine - racked up healthy gains on Wednesday after Citigroup upgraded the stock to 'neutral' from 'sell' as the shares reached its price target of 208p.Citi reckoned the main reason for the recent share price decline is movement in coking coal spot prices since it published its last note on Evraz back in September, when it cut the stock to 'sell' from 'neutral'.Since then, hard coking coal spot prices have fallen from about $270 a tonne to about $215/t."There is considerable uncertainty on the medium and long-term outlook for coking coal prices but broadly, we believe the share price approximately reflects the Citi commodity team's view of hard coking coal averaging $113/t in 2018."Risk and reward appear to be roughly balanced at the current level in our view and thus believe the shares no longer face significant downside risk."At 1450 GMT, the shares were up 5.9% to 220.70p.