Ferrovial shares drop 5% following UBS downgrade

Ferrovial shares fell nearly 5% on Wednesday, reaching their lowest levels in nearly a year, following a downgrade by UBS. The Swiss bank shifted its recommendation from “buy” to “neutral” and lowered its price target from 65 to 59 euros per share.

The downgrade stems from uncertainty regarding the profitability of a major project in Tennessee, United States. The project involves the DriveTN consortium, led by Ferrovial alongside Transurban and Tikehau Star Infra, to develop express lanes on the I-24 Southeast highway between Nashville and Murfreesboro.

UBS analysts expressed concern that the project’s expected return on equity—estimated at approximately 7% under optimistic assumptions—is significantly lower than the 20% average Ferrovial has historically achieved in similar U.S. projects. The bank noted that the high investment volume and a substantial concession fee of approximately 21.2 billion euros over 50 years present a higher-than-usual risk profile.