Gazprom Value Sinks - To Below $100 Billion
The stock value of Russian state gas company Gazprom has sunk below $100 billion (€78 bn), disappointing President Vladimir Putin, according to agencies.
Bloomberg reports that the gas behemoth is valued at less than $100 billion for the first time since 2009.
American depositary receipts of Gazprom sank 2.9% to $8.25 in New York yesterday, pushing the market value of Russia’s gas export monopoly to $97.7 billion, the lowest level since July 2009. Shares tumbled to a four-year low in Moscow.
Gazprom's market value has gone down by a third over the past year, due to rising costs, declining profit and the prospect of lower-than-forecast dividends deter investors. Gazprom trades at 2.9 times estimated earnings, the second-cheapest stock on Russia’s 50-member Micex Index.
“Gazprom’s dividends disappointed - that was just the latest blow to investors - and there are risks their contracts will be revised and prices lowered spurring further declines in net profit,” Alexei Kokin, a senior oil and gas analyst in Moscow, told Bloomberg. “There is hope that the company’s management will be replaced, this is the only thing that would be able to turn the stock around.”
At Gazprom's 20th birthday celebrations in February, Putin, who depends on the vast receipts the gas company compiles for much of Russia's wealth, urged it to improve its performance.
See also: Cash For Gazprom?