OVH Groupe shares fell 4%, hit by a rating downgrade from Morgan Stanley, which moved from "equal-weight" to "underweight" on the cloud service provider, lowering its price target from 9.05 to 8.50 EUR.
In a note on European technology stocks, the broker highlighted limited upside potential for OVH's share price relative to its new target, following recent stock performance.
Morgan Stanley also pointed to the recent surge in memory prices, which it believes could create headwinds for capital expenditure and free cash flow generation in 2026 and 2027.
OVH Groupe is the leading European cloud services provider, uniquely positioned to capitalize on the rapidly growing cloud market.
The Group provides business customers with a comprehensive suite of solutions designed to capture growing demand for multi-cloud and hybrid cloud strategies, while meeting the surging demand for data sovereignty and trusted cloud solutions.
OVH Groupe provides 1.6 million customers - composed largely of SMBs, large and tech enterprises, as well as the public sector - with a comprehensive suite of solutions in private, public and web cloud, leveraging its global network of 44 data centers, hosting over 500,000 servers across 4 continents.
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