EVRAZ stock price prediction: outlook for the Russian steelmaker
EVRAZ (EVR), the Russian steelmaker in which Roman Abramovich is a majority shareholder, has today (April 1) canceled plans to split its coal assets (PJSC Raspadskaya) following the sanctions imposed following the Russian invasion of Ukraine.
The sanctions imposed by the British government on the Russian oligarch also led to the loss of the company’s shares. suspended of the London Stock Exchange (LSE).
These actions led to a crash in the company’s share price which was at 452p on February 11 and is now at 81p.
But what does this mean for investors? In this EVRAZ stock price analysis, we take a look at the prospects for EVRAZ and consider whether life can ever return to normal.
Technical analysis EVRAZ (EVZ): Rally interrupted by the invasion of Ukraine
EVRAZ stock had done well until Russia invaded Ukraine. It had risen 22% in 2021, from £4.92 ($6.73) at the start of January to £6.01 at the end of December.
It did, however, drop dramatically in the weeks leading up to its suspension from the London Stock Exchange on March 10, 2022, as seen in the EVRAZ share chart below.
The price fell 87% due to political fallout from Russia’s invasion of Ukraine, from £6.13 a share at the start of the year to just under 81p when trading was suspended. action by the Financial Conduct Authority. Will EVR stock price bounce back from the crash?
Technical analysis for March 28 showed bearish sentiment with all simple moving averages and exponential moving averages indicating sell signals. The Relative Strength Index (RSI) was neutral at 23.33, and the Moving Average Convergence Divergence (MACD) indicator was deep in negative territory at -98.11.
EVRAZ Perspectives: Latest Results
On February 25, 2022, EVRAZ announcement total revenue for 2021 increased 45% to $14.16 billion, with net income up 262% to $3.1 billion. It also had more than $2.2 billion in free cash flow.
It also said that the spin-off of its coal business should be completed by the end of March 2022. However, this decision was reversed on April 1. The company’s statement said: “In light of the unprecedented sanctions against Russia and the Russian special economic measures in response to the sanctions, which were beyond the company’s control, the execution of the transaction has become technically impossible.”
In one declarationManaging Director Aleksey Ivanov said fluctuations in demand had been the main driver for the steel industry in 2021.
“Steelmakers have increased production in anticipation of more robust demand from the construction and manufacturing sectors,” he said. “Unable to keep up with the accelerating pace of recovery, steel prices hit their highest level in years.”
Looking ahead, Ivanov said the plan is to “continue improving our ESG performance” and “reinforce our culture” of continuous operational improvement.
“We are aware of the current geopolitical circumstances,” he added. “We continue to monitor the situation and will keep you informed of any significant developments that may influence our business.”
EVRAZ shares news: Escalating tensions
Unfortunately, the good results were overshadowed by the escalating Russian-Ukrainian crisis.
At the end of February, EVRAZ declared Reuters that he was not planning to withdraw from the London Stock Exchange, despite the heightened geopolitical risks.
However, he added that a secondary listing on the Moscow Stock Exchange was still under consideration and the company did not rule out that such a move could take place in 2022.
On March 9, 2022, EVRAZ published a declaration saying it is “deeply concerned and saddened” by the Ukraine-Russia conflict and hopes that a peaceful solution will be found quickly.
He also provided an update on his business operations, stressing that international sanctions against Russia had had no material effect on his operations.
“The company will continue to keep EVRAZ shareholders informed in accordance with its legal and regulatory obligations,” he said.
Cancellation of interim dividend
On the same day, the company also announcement that its $729 million ($0.50 per share) interim dividend, which was scheduled for March 30, 2022, would not occur.
In a statement, he said the payment was not considered in the best interests of the company or its shareholders.
“While the imposition of international sanctions against Russia and the restrictions imposed by Russia to date have had no significant direct impact on the day-to-day operations, trading or financial condition of EVRAZ, given the uncertainties arising of the current situation regarding Russia and Ukraine, the Board has nevertheless decided to cancel the interim dividend,” he said.
Temporary suspension and board changes
The UK Financial Conduct Authority announcement on March 10, 2022 that it suspended EVRAZ shares to “protect investors”, pending clarification of the effect of British sanctions.
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The following day, EVRAZ published a declaration which reaffirmed its hope of reaching a peaceful resolution and announced the resignation of all its non-executive directors.
He said: “In light of the Financial Sanctions Notice issued by the Office of Financial Sanctions Implementation, Her Majesty’s Treasury, on March 10, 2022 and the suspension of the Company’s shares from trading, all non-executive directors of EVRAZ plc – Alexander Abramov, Alexander Frolov, Alexander Izosimov, Deborah Gudgeon, Eugene Shvidler, Eugene Tenenbaum, Karl Gruber, Maria Gordon, Sir Michael Peat and Stephen Odell – have resigned as directors with effect immediate. Alexey Ivanov, CEO of the company, will remain a director.
In one Release on March 11, EVRAZ announced that Nikolay Ivanov, who had joined the company as CFO in November 2016, had been appointed executive director of the board.
EVRAZ Stock Price Prediction: Goals for 2022 and Beyond
Is EVRAZ a good investment in 2022? Is it possible for the stock to recover from the recent drop in EVRAZ stock price to levels not seen in the past five years? According to Wallet Investor’s algorithmic EVRAZ stock forecast on April 1, the stock could be an “awesome long-term (one year) investment” that could rise nearly 73% to 137p over the coming year.
According to the service’s forecast, EVR stock could reach 200p by the end of 2023 and 308.5p by the end of 2024.
The site also gave a five-year EVR share price prediction that suggested the price would hit 359.69p by March 2027, a 344% increase from the current price. Analysts did not share longer-term price targets for 2030.
Are EVR shares a ‘buy’, ‘sell’ or ‘hold’? The sight of market beat suggests the stock as a ‘buy’ which will rise to £6.50 over the next 12 months. However, this was based on a single analyst, so hardly a reflection of current market sentiment.
Meanwhile, TipRanks also gave an upbeat forecast for EVRAZ stock price based on the expectations of three analysts. Two of them rated the stock as a “buy” and one remained neutral with a “hold” recommendation. Their EVRAZ share price forecast estimated that the stock could average 410p within 12 months. Analysts pegged the highest estimate at 490p and the lowest at 330p.
EVRAZ Share Price Prediction: What Analysts Think
With EVRAZ shares suspended from the London Stock Exchange, there is great uncertainty for existing shareholders, according to Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown.
“Although there are increasing calls for Russian companies to be delisted in London, it is likely that instead they will be left in limbo,” she told Capital.com.
However, she thinks there are still likely to be long-term implications.
“If trading does eventually resume, EVRAZ will most likely remain a toxic brand for a considerable time,” she said. “While some bargain hunters may come back sniffling, the stock is unlikely to return to pre-conflict levels anytime soon and should be plagued by volatility as the business and financial world weighs intentions. term of Moscow.”
Danni Hewson, financial analyst at AJ Bell, agrees that there are “a lot of ifs, buts and maybes to consider” when it comes to EVR shares.
“If the situation in Ukraine can be resolved quickly, if the company is relisted on the London Stock Exchange and if geopolitical relations can be repaired quickly, then perhaps investors could be persuaded to buy,” he said. she told Capital.com.
However, there are many variables to consider, not the least of which is whether investors want to have a relationship with a company whose “roots are in a country” that has done so much damage, Hewson suggests. .
“Granted, equities look incredibly cheap and commodity prices don’t seem to be falling anytime soon,” she said. “The company doesn’t just have operations in Russia, and some of its other operations may produce windfall profits, but there are no guarantees other than the fact that the stock price is likely to remain volatile. for the foreseeable future.”
When looking for EVRAZ (EVR) stock forecasts, it is important to keep in mind that analyst forecasts and algorithm-based price targets can be wrong. Projections are based on performing fundamental and technical studies of the historical EVR stock price pattern – but past performance is no guarantee of future results.
It is essential to do your own research and always remember that your decision to trade depends on your attitude towards risk, your market expertise, the allocation of your investment portfolio and your ease with losing money. money. You should never trade money that you cannot afford to lose.
EVRAZ is a steel, mining and vanadium company with operations in Russia, the United States, Canada, the Czech Republic and Kazakhstan.
Its origins date back to 1992 when a group of Russian scientists and engineers established EVRAZMetall, which specialized in trading steel products and supplying raw materials to steel mills.
It became a London listed company in 2011 and was subsequently promoted to the premier FTSE 100 (UK100) index of leading companies.