UBS Says Sell Telmex

UBS Pactual has downgraded the stock of Telmex Internacional to sell after a strong rally. In the past 3 weeks the stock was up 34%, beating the local Bolsa, which gained 19%, and peers America Movil (+15%) and Telmex, (+3%). The stock is trading at a premium to peers, but UBS believes this is not justified, especially as 80% of revenues are derived from Brazilian telecom Embratel, which itself gets 50% of revenues from declining long-distance businesses. The shop’s price target for Telmex Internacional stock is MXP5.75. On March 24 it closed at MXP6.75.