Aegis saw its share price plummet by as much as 8% in early trading, before before clawing back some ground to 96p, down 5.88%. HSBC currently has the media buying group ranked as an "add", but market speculation suggests it would be downgraded as low as a "reduce".
Shares in Aegis have suffered of late as analysts cut forecasts. In October, Merrill Lynch reduced its 2001 pre-tax profit forecasts dramatically, from £67.2m to £54.5m -- a cut of 19%. It also reduced the group's 2002 prospects by 25% from £75.9m to £57.1m.
The week has not been kind to media stocks. Monday saw rises across the board, as the industry was buoyed by the government's media-ownership consultation paper. By Wednesday, it was red all round, with the falls headed by Cordiant Communications which saw its share price fall by 8.1% to trade at 95.5p yesterday and continue to head down this morning.
Aegis's troubles have spurred takeover talk at various points this year. However chief executive Doug Flynn has vowed that the company will remain independent.
The group announced the acquisition of Japanese market research firm Research Fact this morning for the sum of £1m.
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