Sasol Shares Face Analyst Scrutiny Amid Cash Flow Concerns

Morgan Stanley has issued a significant downgrade for South African energy and chemicals group Sasol, shifting its investment stance and lowering the price target. The bank’s revised assessment points to persistent cash flow challenges and deep-seated structural issues within the company’s domestic operations as primary causes for concern.

In a move that underscores growing apprehension, Morgan Stanley adjusted its rating for Sasol from “Overweight” to “Equal-weight” this past Monday. Concurrently, the firm slashed its price target significantly, from 140 South African Rand to 120 Rand. The analysts justified this decision by highlighting disappointing projections for free cash flow in 2026 and 2027, which are anticipated to be a mere 5 to 6 Rand per share. This level of cash generation would imply a valuation multiple... Read more...