JP Morgan Maintains Neutral on Manitowoc After Pre-Announced 4Q Earnings
JP Morgan has published a research report on Manitowoc Company (NYSE: MTW) after the company pre-announced it's 4Q results.
In the report, JP Morgan writes, "MTW pre-announced its Q4'11 results last night on the back of hydraulic component supplier issues coupled with costs related to an ongoing strike (since Nov. 14) at its Manitowoc Crane facility. Management estimates that the supplier issues will result in ~$35MM in Crane revenues being deferred into Q1'12. In addition, management expects operating income to be $10MM lower. Importantly, management now expects to be able to meet only the low end of its debt-reduction guidance of $150MM-$200MM for the year, and in our view, this raises the risk profile of the company into 2012. While the company's preannouncement is not a total surprise, as news of the strike has been widely published in the media, we believe it does, however, highlight the continued execution risks the company faces as it begins to ramp up its production with an over-leveraged balance sheet – net debt to capital will be ~80% at year-end and could rise if working capital needs accelerate in 2012."
JP Morgan maintains its Neutral rating on Manitowoc, which is currently trading down $0.21 from yesterday's $10.76 closing price.
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