Piper Jaffray Maintains a 'Neutral' on Valmont Industries (VMI); Adjusts PT & Estimates

October 19, 2009 12:52 PM EDT

Piper Jaffray & Co. maintains a 'Neutral' rating on Valmont Industries, Inc. (NYSE: VMI), price target increased from $75 to $77.

Piper analyst says, "We are reducing our FY10 estimates to reflect a declining Utility segment backlog and expect VMI shares to remain range bound until trough estimates for the cycle can be more accurately assessed. VMI has delivered exceptional results over the past two years - driven by unprecedented strength in the Irrigation segment in FY08 and then strong project activity in the Utility segment in FY09...Our 4Q09 EPS estimate of $1.13 is in-line with guidance. Looking to FY10, we are lowering our EPS estimate from $5.03 to $4.50, incorporating 20% sales contraction in Utility and 200 bps of total operating margin compression as a result of lower fixed cost leverage. Absent an unexpected new 6-year highway spending bill or resurgence in farm capex spend, we believe difficult comparisons in Utility will weigh heavily on FY10 results."

To see more analyst ratings on VMI Click Here.

Valmont Industries, Inc. produces fabricated metal products; metal and concrete pole, and tower structures; and mechanized irrigation systems in the United States and internationally.

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