Crédit Agricole shares fell on the Paris Bourse on Tuesday, after Goldman Sachs lowered its recommendation to "sell" from "neutral", citing an outlook inconsistent with the group's valuation.

On the Paris Bourse, at around 09:00 GMT, the stock was down 2.65%, the lantern of the CAC 40, down 0.84% at the same time.

"By 2023, Crédit Agricole has outperformed its peers and is currently trading at a premium to the sector," point out Goldman Sachs analysts in their note.

They justify their downgrade by the slowdown in earnings growth, the valuation premium and the lower capital payout compared with competitors.

Goldman Sachs notes that its outlook for 2024 and 2025 is down, whereas the consensus has been up since the beginning of the year, placing its EPS forecast for 2025 7% below consensus.

"When we compare Crédit Agricole to its Eurozone peers, taking into account growth prospects and current valuation, we find that Crédit Agricole's value is lower," the analysts write.

"Around 90% of the eurozone banks we cover are expected to grow earnings faster than Crédit Agricole over the next two years, while only around 20% are trading at a higher multiple" than Crédit Agricole, Goldman Sachs adds.

Of the 20 analysts covering Crédit Agricole, four recommend "Strong Buy" or "Buy", 12 "Hold" and four recommend "Strong Sell" or "Sell", according to data from LSEG. (Written by Clément Martinot, French version by Corentin Chappron, edited by Blandine Hénault)