Jefferies Raises Price Target on Cytec (CYT), Partial Sale or Spin Off of Coating Offers Best Potential
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Price: $3.02 --0%
Rating Summary:
5 Buy, 6 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
5 Buy, 6 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Jefferies is reaffirming its Hold rating on shares of Cytec Industries Inc. (NYSE: CYT) and is raising its price target from $47 to $49 following third quarter results.
The firm notes that better than expected results in Coating and Additive Technologies offset lower than expected results in Engineered Materials and in Process Separation. Lower Corporate & Unallocated, taxes, other income, interest expense, minority interest, and shares outstanding accounted for around two thirds of the upside.
Jefferies believes management's fourth quarter guidance entails the worst case scenario, but notes they could miss if pricing power deteriorates.
An analyst at Jefferies comments, "With management indicating that a decision will be made by the Q4 call, we have developed a range of scenarios, including spinning off Coatings, selling it at a fire sale rate or fair value, or a partial sale of the more commoditized assets. The net conclusion is that a fire sale may provide only modest upside, but either a spin or a partial sale could prove compelling over 12-24 months."
The firm is reducing its 2011 and 2012 EPS estimates from $3.30 and $3.40 to $3.26 and $3.30.
For more ratings news on Cytec Industries Inc. click here and for the rating history of Cytec Industries Inc. click here.
Shares of Cytec Industries Inc. closed at $42.90 yesterday.
The firm notes that better than expected results in Coating and Additive Technologies offset lower than expected results in Engineered Materials and in Process Separation. Lower Corporate & Unallocated, taxes, other income, interest expense, minority interest, and shares outstanding accounted for around two thirds of the upside.
Jefferies believes management's fourth quarter guidance entails the worst case scenario, but notes they could miss if pricing power deteriorates.
An analyst at Jefferies comments, "With management indicating that a decision will be made by the Q4 call, we have developed a range of scenarios, including spinning off Coatings, selling it at a fire sale rate or fair value, or a partial sale of the more commoditized assets. The net conclusion is that a fire sale may provide only modest upside, but either a spin or a partial sale could prove compelling over 12-24 months."
The firm is reducing its 2011 and 2012 EPS estimates from $3.30 and $3.40 to $3.26 and $3.30.
For more ratings news on Cytec Industries Inc. click here and for the rating history of Cytec Industries Inc. click here.
Shares of Cytec Industries Inc. closed at $42.90 yesterday.
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