UBS Cuts Estimates and Price Target on Joy Global (JOY); Not Getting Too Negative Yet

August 30, 2012 10:57 AM EDT Send to a Friend
Get Alerts JOY Hot Sheet
Price: $50.94 -2.38%

Rating Summary:
    8 Buy, 13 Hold, 4 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 29 | Down: 28 | New: 24
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UBS maintains a 'Neutral' on Joy Global (NYSE: JOY) price target of $55.00 (from $58.00).

Analyst, Henry Kirn, said, "Q3 orders of $1.1B, down 25% YoY & down 35% ex-acquisitions, offer clear evidence of broad weakening in end market demand. JOY noted “the deceleration of China demand has deteriorated international markets more quickly and severely than previously expected” and sees FY13 net sales "flat to down slightly." With this as backdrop, we are lowering FY12E, FY13E & FY14E EPS to $6.95, $6.80 & $7.15, from $7.20, $7.50 & $7.90."

Overall, Kirn thinks valuation is not demanding, but visibility to demand is murky. However, he cautions against too negative a near-term view and think the MINExpo tradeshow in LV could provide a near-term catalyst. Other positives include strong management, market share with aftermarket exposure and potential M&A catalysts.

FY12 EPS estimate lowered from $7.20 to $6.95 and FY13 from $7.50 to $6.80.

For an analyst ratings summary and ratings history on Joy Global click here. For more ratings news on Joy Global click here.

Shares of Joy Global closed at $54.43 yesterday.


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