At least one financial commentator (with a dubious track record) suggests that PGH's sp fell Thursday because its annual meeting referred to subdued conditions, especially agricultural products. Problem is, PGH held its annual meeting on Wednesday morning (not Thursday), and the sp was stable throughout Wednesday. Probably a trivial discrepancy to the commentator, but there are likely more accurate explanations for Thursday's fall:
1. On Thursday (or after hours Wed), two analysts (Credit Suisse and Deutsche Bank) downgraded PGH to hold/neutral from buy, mostly because its sp had risen above the target price. However, CS predicts PGH can increase its ebitda by $30m by FY18.
2. In an AFR article on Thursday, Geminder and Cridland (outgoing CEO) back away from the five-year goal of a $5 billion firm, saying that US/Europe firms are too expensive to acquire, and that organic growth won't achieve the goal. They (correctly/wisely) say that 8 years or more to that goal is better than overpaying for acquisitions. But perhaps investors didn't read the bit where both execs say PGH has a good pipeline of potential acquisitions ahead (in OZ and Asia)
"We have a robust M&A pipeline in front of us and we will continue pumping away on that with a view to moving towards that light on the hill."
PGH Price at posting:
$4.78 Sentiment: None Disclosure: Held
