(Sharecast News) - Analysts at Canaccord Genuity lowered robotics group Blue Prism to 'sell' from 'hold' on Wednesday, stating that the group's valuation was now "full".
While Canaccord noted that Blue Prism had completed a ?100m raise, the analysts said they remained "cautious" on a business model that required such a "large inflow of cash to sustain it".
The Canadian broker expects Blue Prism's cost base to somewhat flatten in its current trading year with the impact of Covid-19 as yet unknown, but its main concern remained that it begins to grow substantially once normal service resumes and that the "don't spare the cost" pursuit of sales growth begins again.
Canaccord also said it believes that the main Covid-19 trading hit will impact the group's second half.
"Our valuation basis has not changed over the last 12 months and probably won't until we have sight of a near-positive adjusted EBIT figure (but not EBITDA, which becomes more and more meaningless with R&D capitalisation and IFRS16 for many companies, not just Blue Prism," said Canaccord.
The analysts also reiterated their 1,050p target price on the group.