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Collins Stewart Downgrades DigitalGlobe (DGI) to Hold; Valuation Call

November 10, 2009 7:59 AM EST
DGI Hot Sheet
Rating Summary:
    6 Buy, 1 Hold, 1 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 16 | Down: 7 | New: 23
Collins Stewart downgrades DigitalGlobe (NYSE: DGI) from Buy to Hold.

Collins analyst says, "We are lowering our recommendation on DGI to Hold post the company's Q3 results released last night. EPS was better than expected. However, the company cautioned investors on the upcoming EnhancedView contract and the uncertainty surrounding timing of its award. This could impact 2010 consensus as some of the higher estimates for the year are lowered and pressure the stock. With the stock within shouting distance of our $25 target and 2010 estimates, for now, capped, it is time to step aside."

"At quarter-end, DigitalGlobe had signed four customers under the Direct Access Program (DAP) with estimated revenue potential of $25-$30 million per year. The target is seven with potential revenue of $50 million per year...Our 2010 outlook is virtually unchanged, but more back-end loaded. We assume DAP customers build in the first half and the NGA contributes in the second half. Timing on EnhancedView has a large impact."

To see more analyst ratings on DGI Click Here.


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