Shares of Lions Gate Entertainment Corp. are likely to slide without the support of Carl Icahn's offer to buy the movie company, a Jefferies & Co. analyst said Thursday as he cut his rating on the stock.
"Absent Icahn's tender offer we see more downside risk to the (company's) share price, and only marginal upside if his offer were to be raised," Jefferies analyst Brian Shipman told clients in a note.
Icahn, who has berated Lions Gate management for allowing the company's share price to slip over the past few years, has said he will not raise or extend his $7-per-share offer, which expired Wednesday evening.
The billionaire investor has bought about a third of the company's shares, but has not said how many more shares were tendered by the deadline.
Lions Gate shares have traded close to $7 since Icahn made his bid, closing at $6.98 on Wednesday. Before that they had traded as low as $4.81 in the past year.
Shipman, who cut his rating to "Hold" from "Buy," said that uncertainty about Icahn's next move and the potential for more feuding with the company's management could drag on its stock price.
Icahn, for instance, does not share the company's interest in potentially acquiring another film studio, arguing that declining DVD sales have made film catalogs less valuable.
© Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.