DA Davidson Downgrades Northwestern Corp. (NWE) to Neutral; Shares Approaching Fair Value

DA Davidson downgraded Northwestern Corp. (NYSE: NWE) to Neutral with a price target of $36.00.

DA analyst says, "We are increasing our 2011 EPS forecast from $2.30 to $2.32 to account for the positive 3Q variance from our forecast and a lower expected income tax rate in 4Q. We have also adjusted our 2Q’11 data to strip out the $0.03 per share positive impact of a nonrecurring tax benefit. Our 2012 EPS estimate is reduced from $2.45 to $2.40, as the negative impacts of higher interest expense and a more conservative assumption of demand growth are partially offset by a lower assumed tax rate...Although we continue to believe NWE’s relatively low-risk pipeline of small- and mid-sized capital projects will provide an attractive growth driver beginning in 2013, near-term upside in the shares appears limited at the current valuation level."

For more ratings news on Northwestern Corp. click here and for the rating history of Northwestern Corp. click here.

Shares of Northwestern Corp. closed at $35.10 yesterday.

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