RBC Capital has adjusted its outlook on Equinor (EQNR, Financial), downgrading the stock to "Underperform" from its previous "Sector Perform" rating. This change comes with a revised price target of NOK 260, reduced from NOK 300.
The analyst cited Equinor's strong recent performance despite a broader market selloff, largely due to its position as a significant player in the European gas market. However, RBC anticipates that factors such as Equinor's oil exposure and Norway's tax structure will affect its financial performance. These elements are expected to compress near-term free cash flow and increase financial leverage, making Equinor's cash flow and dividends appear less attractive when compared to its industry peers.
