Brighthouse shares fall the most in at least a year on Tuesday, two brokerages downgrade stock as lower interest rates may hurt earnings

Shares of Brighthouse Financial Inc (BHF) registered their largest single-session loss in over a year on Tuesday, after at least two brokerages downgraded the companys stock, since cuts in interest rates may probably reduce distributable earnings.

Brighthouse Financial shares closed lower for the fifth time in the past nine trading sessions on NASDAQ on Tuesday. The stock went down 11.70% ($4.46) to $33.66, after touching an intraday low at $32.53, or a price level not seen since January 9th ($32.46).

Shares of Brighthouse Financial Inc have risen 10.43% so far in 2019 compared with a 16.38% gain for the benchmark index, S&P 500 (SPX).

In 2018, Brighthouse Financial’s stock went down 48.02%, thus, it again underperformed the S&P 500, which registered a 6.24% loss.

Credit Suisse revised down its rating on the stock from “Neutral” to “Underperform”, as it noted that lower interest rates could diminish distributable earnings by $1 billion over the upcoming three years. The firm cut its 12-month price target on the shares from $35 to $22.

At the same time, Goldman Sachs downgraded the stock from “Neutral” to “Sell”, as it expects “little to no distributable earnings” from Brighthouse Financials variable annuity business. The brokerage also slashed its 12-month price target from $39 to $32.

According to CNN Money, the 14 analysts, offering 12-month forecasts regarding Brighthouse Financial Inc’s stock price, have a median target of $43.00 with a high estimate of $47.00 and a low estimate of $22.00. The median estimate represents a 27.75% upside compared to the closing price of $33.66 on June 25th.

The same media also reported that 12 out of 16 surveyed investment analysts had rated Brighthouse Financial Inc’s stock as “Hold”, while 1 – as “Buy”. On the other hand, 3 analysts had recommended selling the stock.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for Brighthouse Financial Inc (BHF) are presented as follows:

Central Pivot Point – $38.22
R1 – $38.87
R2 – $39.64
R3 – $40.29
R4 – $40.95

S1 – $37.45
S2 – $36.80
S3 – $36.03
S4 – $35.27