Goldman Sachs has downgraded Neste Oyj (HE:NESTE) to “neutral” from “buy,” pointing to the Finnish refiner’s strong performance and its shares trading at a premium to replacement cost.
The brokerage said the catalysts that previously underpinned its bullish view, such as tightening renewable diesel and sustainable aviation fuel markets, have largely played out.
“Neste’s share price is up 38% ytd and 140% since the trough in April 2025 (in EUR), resulting in current market EV of $21 bn,” Goldman Sachs said.
“We estimate total replacement cost at $18.8bn, which implies Neste now trades at a c.10% premium to asset replacement cost value.”
The downgrade came as Goldman Sachs kept its 12-month price target unchanged at €17.00, compared with the closing price of €17.28 on Sept. 16.
That implies a downside of 1.6%. The bank said while medium-term upside remains, near-term earnings momentum looks limited. “We now see less near-term earnings upside and therefore take Neste off the Buy list and lower our rating to Neutral,” the analysts said.
Goldman Sachs projected third-quarter renewable products margin at $440 per ton, slightly above the $425 per ton consensus.
But it flagged higher operating costs from scheduled maintenance at plants in Rotterdam and Singapore as a headwind.
“We therefore model $420/t RES margin in Q4, down $20/t qoq and marginally below $440/t consensus,” the report said.
Following earnings forecasts ahead of third-quarter results, adjustments were made to EBITDA estimates.
Source :
https://www.investing.com/news/stock-market-news/goldman-sachs-cuts-neste-to-neutral-as-shares-soar-140-above-value-4243875
