Canal+ shares plummeted after UBS Group AG said the stock was fairly valued, bucking the trend of analysts predicting gains following the French television company\u2019s debut in London this week.<\/p>\n\n\n\n
The stock dropped as much as 19% to 191.10 pence as UBS analysts, including Ben Shelley, started coverage with a neutral rating and a 240 pence price target.<\/p>\n\n\n\n
UBS cited Canal+\u2019s ongoing purchase of MultiChoice, which it noted is facing declining profit in South Africa and expanding free cash flow losses caused by currency impacts.<\/p>\n\n\n\n
\u201cThe risk of value erosion stemming from the MultiChoice transaction leads us to a more cautious view on the equity story<\/strong>,\u201d said Shelley.<\/p>\n\n\n\n The UBS price target is in stark contrast with that of CIC Market Solutions, which on Thursday said it sees the shares rising to 450 pence, arguing the the market has already factored in the MultiChoice risk.<\/p>\n\n\n\n Canal+ was the largest of three companies spun out of parent business, Vivendi SE. Its arrival on the London Stock Exchange was seen as a boost for the bourse, which has suffered from companies choosing to switch their main listings to New York and because of outflows from UK equity funds.<\/p>\n\n\n\n Vivendi also carved out advertising unit Havas NV and publisher Louis Hachette Group for separate listings on Monday. <\/p>\n\n\n\n However, after Thursday\u2019s slump for Canal+, the combined value of Vivendi and its three spinoffs was 10% less than Vivendi\u2019s standalone price on Dec. 13, according to calculations by Bloomberg.<\/p>\n\n\n\n
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