Goldman Sachs has reclassified Sasol Ltd. (NYSE: SSL) from Buy to Neutral and established a price target of ZAR118.00, citing a constrained upside relative to other Buy-rated names within its coverage universe. The bank's call was accompanied by a note warning that a weak product price outlook will likely restrict the scope for upward earnings revisions in the coming months.
Sasol's U.S.-listed shares were trading at $7.36 at the time of the update, roughly 4% below the stock's 52-week high of $7.66. The firm has delivered a 75% price return over the past year, a performance Goldman Sachs acknowledged while still seeing limited room for further rerating.
Goldman Sachs analyst Faisal AlAzmeh emphasized that, despite Sasol's attractive valuation metrics - including a price-to-earnings ratio of 5.87 and an enterprise value-to-EBITDA multiple of 2.81 - current market conditions reduce the likelihood of significant upside versus other names the bank prefers. The downgrade reflects Goldman Sachs' view that the stock's upside is insufficient when set against those alternatives.
Goldman Sachs also noted that Sasol's investments in quality improvement are constructive for investors' confidence in the company's operations. However, the firm concluded that these operational enhancements are currently outweighed by broader pressures, notably volatility in Brent crude prices and wider macroeconomic dynamics that affect product pricing and earnings visibility.
Independent analysis referenced in the update - investing platform analysis described Sasol as undervalued, highlighting an 18% free cash flow yield that suggests potential upside beyond Goldman Sachs' assessment. The platform also rates Sasol's financial health as "GOOD" and provides 13 ProTips and comprehensive valuation metrics for subscribers seeking deeper detail.
In separate corporate governance news, Sasol has announced the appointment of Rhidwaan Gasant as an independent non-executive director, effective February 1, 2026. Gasant's background includes over three decades of experience in professional services and the energy sector, having served as a senior audit manager at KPMG and holding senior executive finance roles such as Financial Director of Engen Limited and CEO of Energy Africa Limited. The company framed the appointment as part of efforts to bolster the board with experienced leadership.
The company has not released any recent earnings or revenue results in the most recent updates, nor has it announced any mergers or acquisitions. The company also has no recent analyst upgrades or downgrades reported aside from the Goldman Sachs action described above. These notes point to a period of focus on governance and operational improvement rather than on new corporate transactions.
Bottom line: Goldman Sachs' move to Neutral and its ZAR118.00 target reflect the bank's judgment that product price headwinds, plus commodity and macro volatility, limit Sasol's upside despite solid recent returns and favorable valuation indicators. At the same time, the company is advancing governance with a high-profile board appointment.