Morgan Stanley on Wednesday lowered its recommendation on Scor shares from 'overweight' to 'weighted in line', with a price target reduced from 36 to 25 euros.

In a research note, the research firm describes the profit warning issued yesterday by the French reinsurance group as 'disappointing'.

While the company's property-casualty (P&C) business and capital position remain intact, the lack of visibility surrounding its life and health (L&H) businesses leads us to stay away from the stock", explains the analyst.

Morgan Stanley points out that its favorable opinion on the stock was previously based on an attractive valuation compared with peers, with a view to a stabilization of results likely to lead to a stock market revaluation.

Following yesterday's disappointment, the professional says he expects Scor to pay a dividend of 1.80 euros this year, the minimum amount to which it had committed itself, whereas the consensus was previously targeting a coupon of 1.90 euros.

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