Glencore shares fall as Citi cuts target price

18th Feb 2016 09:49

(ShareCast News) - Glencore's shares declined on Thursday after Citi cut its target price to £1.40 from £1.50, reflecting lower commodity price forecasts.Citi said its estimates for 2016 earnings before interest, tax, depreciation and amortisation falls by 5.1% to $7.8bn (£5.35bn).Glencore is expected to generate free cash flow of $3.8bn in 2016. Net debt is forecast to come in at $25.4bn for 2015 and $20.8bn by the end of 2016 compared to the company's target of $18-19bn.Citi hailed Glencore's early refinancing of a $8.45bn loan facility which was due to expire in May."We think it is a positive step and shows the commitment of the banks to Glencore and also removes some near-term liquidity concerns. Our NPV declines to £2.70 from £2.90; we lower our TP to £1.40 from £1.60. Buy," said Citi analyst Heath Jansen.Shares fell 0.88% to 118.95p per share at 1047 GMT.