There hasn’t exactly been a lack of warning lights.
The price development in the land-based fish farming company Atlantic Sapphire has been a continuous nightmare since it peaked in the winter of 2021. Although the company has had extensive operational challenges since it was established 12 years ago, and has had a spectacular construction project, with both financial and operational risk, there have been few critical voices among investment banks.
Last summer, the company was valued at NOK 10 billion (€1 billion). Even so, there was only one investment bank, SEB, which had a negative recommendation on the share, Finansavisen wrote.
In August 2021, after the share price had nearly halved from its peak, ten investment banks covered the company, according to Bloomberg. Eight of them recommended their customers to buy the share, at a time when the price was around NOK 80.
The highest price target was signed by Nordea Markets, who believed the share was worth NOK 173. SpareBank 1 Markets was close behind with a price target of NOK 153.
SEB maintained its negative recommendation until August this year. Then analyst Bent Rølland went for a neutral recommendation. Atlantic Sapphire’s share price then stood at NOK 22.
“The message for us has long been “stay away”. Producing salmon in tropical areas is not exactly easy. On the plot next door to Atlantic Sapphire’s facility in Florida, they grow oranges and watermelons – it might fit a little better there,” Rølland told Finansavisen.
On Wednesday, the price ended at NOK 4.68, after it became known that the company has stopped the development of Phase 2 at the plant in Florida.