Deutsche Bank and Charles Stanley downgrade Randgold to 'hold'

Shares in Randgold Resources were squeezed lower on Tuesday by downgrades from Deutsche Bank and Charles Stanley, as analysts turned more cautious after a strong run in the stock over the last few months.

Randgold’s annual results on Monday were broadly in line with expectations, with production up 26% but profits falling 16% on the back of a weaker gold prices. However, a 20% hike in the dividend was more than the market had hoped for.

Both Deutsche Bank and Charles Stanley have now cut their ratings to ‘hold’ with the stock having risen by nearly a third over the last three months.

The German bank, which lowered its target price from 5,800p to 5,600p, said that the shares have “run out of upside”.

Similarly, the British broker said: “After a large share price recovery in the last few months we are downgrading to ‘hold’.”

It added that the shares are “fairly highly valued”.

Charles Stanley said: “The share price is fairly well correlated with the gold price, which looks to be trading within a range. From the chart, on this metric risks look to be to the downside.”

Randgold was down 2.1% at 5,300p by 10:58.