Deutsche Bank Downgrades Southwest (LUV) to Hold; Cutting Estimates & PT
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Price: $13.69 --0%
Rating Summary:
11 Buy, 6 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 0 | Down: 2 | New: 2
Rating Summary:
11 Buy, 6 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 0 | Down: 2 | New: 2
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Deutsche Bank downgraded Southwest (NYSE: LUV) from Buy to Hold, price target lowered from $16 to $9.
Deutsche analyst says, "We believe that a lower multiple is more suitable for Southwest shares given the increased execution risk associated with the acquisition and our view that the company will not be able to achieve its financial return objectives (e.g. 15% pretax ROIC) until 2013 at the earliest. As our new 12 month price target implies about 15% upside from last close (compared to much higher implied returns for our Buy-rated names), we are lowering our rating."
"We are lowering our Sep Q 2011 diluted EPS estimate from $0.15 to $0.12 (one of the few names that we left unchanged last week) due to slightly higher expenses (and compares to consensus of $0.10). We are also lowering our 2011 EPS estimate from $0.45 to $0.40 (vs. consensus of $0.36), our 2012 EPS estimate from $0.75 to $0.60 (vs. consensus of $0.78)."
For more ratings news on Southwest click here and for the rating history of Southwest click here.
Shares of Southwest closed at $7.69 yesterday, with a 52 week range of $7.15-$14.32.
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Deutsche analyst says, "We believe that a lower multiple is more suitable for Southwest shares given the increased execution risk associated with the acquisition and our view that the company will not be able to achieve its financial return objectives (e.g. 15% pretax ROIC) until 2013 at the earliest. As our new 12 month price target implies about 15% upside from last close (compared to much higher implied returns for our Buy-rated names), we are lowering our rating."
"We are lowering our Sep Q 2011 diluted EPS estimate from $0.15 to $0.12 (one of the few names that we left unchanged last week) due to slightly higher expenses (and compares to consensus of $0.10). We are also lowering our 2011 EPS estimate from $0.45 to $0.40 (vs. consensus of $0.36), our 2012 EPS estimate from $0.75 to $0.60 (vs. consensus of $0.78)."
For more ratings news on Southwest click here and for the rating history of Southwest click here.
Shares of Southwest closed at $7.69 yesterday, with a 52 week range of $7.15-$14.32.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
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