Braskem (NYSE:BAK) Shares Gap Up - Here's Why

Key Points

• Braskem shares opened higher, rising from a prior close of $1.10 to $1.17 and later trading around $1.2750, with more than 2.4 million shares changing hands.
• Analyst sentiment remains strongly negative: the stock carries an average “Strong Sell” rating, with three Holds and five Sells; UBS and HSBC lowered their price targets to $1.50.
• Braskem reported $4.20 billion in quarterly revenue and $1.61 EPS, but continues to post losses, including a negative 7.28% net margin and negative 67.75% return on equity.

Braskem S.A. (NYSE:BAK - Get Free Report)'s share price gapped up prior to trading on Tuesday. The stock had previously closed at $1.10, but opened at $1.17. Braskem shares last traded at $1.2750, with a volume of 2,404,140 shares trading hands.

Analysts Set New Price Targets

Several equities research analysts have commented on BAK shares. UBS Group cut shares of Braskem from a "neutral" rating to a "sell" rating and cut their price target for the stock from $4.00 to $1.50 in a research report on Tuesday, September 15th. Wall Street Zen upgraded shares of Braskem to a "hold" rating in a report on Saturday, October 17th. JPMorgan Chase & Co. cut shares of Braskem from an "overweight" rating to a "neutral" rating in a research note on Tuesday, June 30th. Weiss Ratings reissued a "sell (e+)" rating on shares of Braskem in a research report on Thursday, October 15th. Finally, HSBC cut shares of Braskem from a "buy" rating to a "hold" rating and dropped their target price for the company from $6.50 to $1.50 in a report on Monday, September 28th. Three analysts have rated the stock with a Hold rating and five have issued a Sell rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of "Strong Sell" and an average price target of $2.56.

Braskem Stock Performance

The firm has a fifty day simple moving average of $1.77 and a 200-day simple moving average of $3.07. The firm has a market cap of $544.09 million, a price-to-earnings ratio of -0.56, a P/E/G ratio of 0.10 and a beta of 1.56.

Braskem (NYSE:BAK - Get Free Report) last announced its earnings results on Friday, June 26th. The company reported $1.61 EPS for the quarter. Braskem had a negative net margin of 7.28% and a negative return on equity of 67.75%. The business had revenue of $4.20 billion during the quarter. Analysts expect that Braskem S.A. will post 1.58 earnings per share for the current fiscal year.

Hedge Funds Weigh In On Braskem

A number of large investors have recently made changes to their positions in the company. SBI Securities Co. Ltd. lifted its holdings in Braskem by 393.2% during the 3rd quarter. SBI Securities Co. Ltd. now owns 25,105 shares of the company's stock worth $36,000 after purchasing an additional 20,015 shares during the last quarter. Cetera Investment Advisers bought a new position in Braskem during the 1st quarter worth $51,000. Citadel Advisors LLC bought a new position in Braskem during the 2nd quarter worth $89,000. Ramsey Quantitative Systems lifted its holdings in shares of Braskem by 24.7% during the third quarter. Ramsey Quantitative Systems now owns 79,000 shares of the company's stock worth $115,000 after buying an additional 15,627 shares in the last quarter. Finally, Private Advisor Group LLC acquired a new stake in shares of Braskem during the first quarter worth $157,000.

Braskem Company Profile

Braskem SA is a Brazil-based petrochemical company that produces basic chemicals and thermoplastic resins used in packaging, construction, automotive components, consumer goods, agriculture and other industrial applications. Its product portfolio includes polyethylene, polypropylene and polyvinyl chloride, as well as inputs such as ethylene, propylene and other petrochemical intermediates.

Founded in 2002 through the combination of several Brazilian petrochemical businesses, Braskem developed into one of Latin America's largest petrochemical producers.

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