Craigs Investment Partners analyst Arie Dekker values the shares at $5.28, down from $6.33 previously.
He is forecasting Fonterra's earnings before interest and tax for the year ending July next year will be $764 million, 25% lower than his previous forecast.
"We re-looked at our forecasts, which factored in quite a lot of growth, and when we went through some of the key drivers of that growth and the things that gave us confidence in them, I guess we saw enough reasons in this first year since listing to scale back our forecast a little bit," Mr Dekker said.
Fonterra had a wide-ranging and complex business, and there was reasonably limited clarity around the financial drivers of the business, which made price discovery and valuation quite difficult, he said.
