BB&T Reiterates Hold Rating on Chiquita Brands (CQB)

BB&T Capital Markets is out with a research report this morning, where it reiterates its Hold rating on Chiquita Brands

; it did not provide a price target for the stock. The BB&T analysts cited the company's recently released quarterly earnings, which were much worse than expected due to a much lower than-expected euro rate, low volumes, and higher costs. The company also lowered its guidance to $50M–$60M from $80M–$90M. It noted that Q3 results were essentially in line with its expectations and that the revision is largely attributable to a weaker-than-expected start to Q4 banana pricing. The analysts said, “Based upon commentary from key competitors, as well as industry reports, we believe there is a reasonable chance that market volumes will be down in 2011,” adding that, “The shares are trading at just 7.7x our revised FY'11 estimate. However, we would prefer to
see stabilization in the market and some concrete industry moves toward supply
rationalization before becoming more bullish.”