Wedbush Downgrades Heckmann Corporation (HEK) to 'Underperform' After Disappointing Results

Wedbush downgraded Heckmann Corporation (NYSE: HEK) from Neutral to Underperform, price target lowered from $5 to $4.

Analyst, David L. Rose, said, "Recent results and the announced acquisition of a recycler of used motor oil provide us less confidence in the company’s ability to create meaningful value in the water sector. While the pending acquisition should be accretive to earnings, the company’s core business of water management is substantially underperforming our estimates; and we believe the strategy to “diversify” signals management views investing in the produced water sector as a less attractive use of its cash."

"Accounting for the pending acquisition, we are raising our 2012 EPS to $0.19 from $0.15 and our 2013 EPS estimate to $0.28 from $0.26. The relatively small increase in 2012 reflects the reduced outlook for the company’s produced water business."

For an analyst ratings summary and ratings history on Heckmann Corporation click here. For more ratings news on Heckmann Corporation click here.

Shares of Heckmann Corporation closed at $4.78 yesterday.

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