ATK Faces Constellation Program Related Risks
Analyst R Spingarn of Credit Suisse downgrades Alliant Techsystems Inc (NYSE: ATK) from "outperform" to "neutral," while reducing his estimates for the company. The target price for ATK has been reduced from $101 to $87.
According to Credit Suisse, the downgrade in rating reflects the effect of the potential wind-down of the Constellation Program on Alliant Techsystems, beginning in FY01. The analyst mentions that “given funding and progress concerns, the president formed the Augustine Commission to review the Constellation program last summer… The Augustine report identified several paths forward, but most require even more funding.”
Credit Suisse says that “with even greater funding constraints and a pending spending freeze that exempts defense, we think something has to go and see manned space at great risk.” Credit Suisse has reduced its estimate for FY11 from $9.25 to $8.65.
