Piper Jaffray Upgrades Gibraltar Industries (ROCK) to Neutral

February 27, 2009 9:19 AM EST

Piper Jaffray & Co. upgrades Gibraltar Industries (Nasdaq: ROCK) from Sell to Neutral. Price target lowered from $11 to $6.

Piper analyst says, "We are upgrading ROCK shares from Sell to Neutral as we believe the company's healthy cash flow profile will provide support to weather through this challenging fundamental backdrop. ROCK shares have fallen 60% since the company negatively pre-announced 4Q results in mid-December and we believe the stock is largely pricing in a worst case fundamental scenario. We are cutting our FY09 estimates sharply to reflect the unit volume declines being experienced across segments, along with increased pricing pressures. We are projecting $85 million in free cash flow in FY09, which we expect will be used to pay down debt. We are also introducing FY10 estimates that reflect stabilizing business conditions and lower interest expense through debt reduction."

Gibraltar Industries, Inc. engages in the manufacturing, processing and distribution of residential and commercial building products, and processed metal products for industrial applications.

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