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Citi says its time to stop selling Micro Focus shares

The bank moves to 'neutral' and says it is "staying selective" in the enterprise software sector.

Micro Focus International plc - Citi says its time to stop selling Micro Focus International Plc shares

It is time to stop selling Micro Focus International plc (LON:MCRO), according to Citigroup, which has upgraded the software firm to ‘neutral’ from ‘sell’.

Citi’s somewhat merciful upgrade follows an 80% decline in the software firm’s share price over the past year.

Commenting more broadly on the enterprise software industry, Citi added that it intends to “stay selective” meanwhile it has a “relatively cautious” stance on the IT services sector.

READ: UBS predicts ‘long and difficult road’ for Micro Focus

Last month, Micro Focus was downgraded to ‘neutral’ from ‘Buy’ by UBS as the Swiss bank predicted a “long and difficult road ahead”.

UBS slashed its target price to 810p from 1,530p whilst highlighting “disappointing” financial results statement – released in February, it showed a 30% drop in adjusted pre-tax profit to US$3.3bn.

The Swiss bank added that Micro Focus’s restructuring was likely to squeeze profits, even if some benefits begin to emerge.

Quick facts: Micro Focus International plc

Price: 436.8 GBX

LSE:MCRO
Market: LSE
Market Cap: £1.46 billion
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