Royal Grolsch stock has been downgraded, despite its continued success in the US.

Shares in the Holland-based brewer were downgraded today (21 May) to 'hold' from 'buy' at Theodoor Gillissen Bankiers, which kept its target price of EUR37.

A TGB analyst said that Grolsch received over 80% of its sales from the Netherlands, the UK and France, referring to them as "stagnant beer markets".

Earlier this year, Goldman Sachs initiated coverage of Grolsch at 'buy' with a price target of EUR34.60. The broker noted that the brewer's "superior cash returns and the potential for large dividend increases from an under-geared balance sheet" would ease market worries over Grolsch's distribution deal in the US with Anheuser-Busch.

Grolsch's operating profit came in at EUR25.6m (US$34.2m) in 2006, compared to EUR25.3m in 2005. Turnover was also up, but again only marginally, to EUR317.6m from EUR312m. Grolsch pointed to slight volume declines in its home market as well as in the UK.