Zacks Investment Research downgraded shares of Total S.A. (TOT) from NEUTRAL to UNDERPERFORM on November 21, 2014, with a target price of $53.00.
We have lowered our recommendation on TOTAL S.A. to Underperform from Neutral as steadily falling oil prices are expected to take a toll on margins, despite the company's cost saving initiatives. A supply glut of crude in the global market due to excessive production from the oil majors is exerting downward pressure on prices and is likely to continue in the fourth quarter. This will hurt the prospects of TOTAL. TOTAL's earnings in the third quarter were higher than the Zacks Consensus Estimate but were a tad lower than the year-ago quarter, primarily due to lower prices of the products sold. TOTAL continues to streamline its asset base through systematic acquisitions and the sale of assets. A significant portion of TOTAL's revenue comes through the inorganic route, which exposes it to acquisition related risks.
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