WPP slumps after double downgrade to 'sell' by UBS

(Sharecast News) - WPP slumped on Thursday after UBS double downgraded the shares to 'sell' and slashed the price target to 700p from 1,200p. The bank said it expects depressed levels of free cash flow this year, and for organic growth to be below consensus expectations and peers in the medium term.

UBS said cuts to advertising spend from TMT (technology, media and telecommunications) clients are likely to continue. This is a problem for WPP, as TMT represented 26% of net sales in FY22.

The banks said recent reports of a potential sale of WPP's stake in Kantar are "helpful" but the timing remains uncertain.

At 1055 GMT, shares in the advertising giant were down 3.1% at 736p.