(Sharecast News) - Barclays downgraded its stance on GlaxoSmithKline shares to 'underweight' from 'equalweight' on Thursday, as it said 2020 looks set to be a much tougher investment year of little growth.
The bank, which left its price target on the stock unchanged at 1,650p, said it was now modelling zero like-for-like sales and a slight earnings per share decline.
"Whilst dividend/free cash flow yields look attractive, the former is likely to remain a source of uncertainty and the latter elevated in the absence of a pipeline/growth story," it said.
Barclays added that while the absolute valuation of the shares is not expensive, it is relatively full. Recent news on drugs such as TANGO and DREAMM2 has been disappointing and there are few pending notable catalysts, it said.
"After being overweight most of calendar 2018 and on the fence through 2019 we think 2020 risk-reward now looks challenged," Barclays said.
At 1410 GMT, the shares were down 1.7% at 1,803.33p.
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