RWE downgraded to "hold"

02.10.06 - ING Financial Markets

LONDON, October 2 (newratings.com) - Analyst Harold Hutchinson of ING Financial Markets downgrades RWE AG (RWE) from "buy" to "hold." The 12-month target price has been reduced from ?81 to ?77.

In a research note published this morning, the analyst mentions that RWE has been unable to participate in ongoing M&A opportunity in the power generation sector due the slower-than-expected water restructuring at the company. The valuation of RWE?s wires business has been downgraded due to the regulatory changes in Germany, the analyst says. The downgrade in the rating is based on valuation, following the recent appreciation in the company's share price, ING Financial Markets adds.