UPDATE: Oppenheimer Trims Innophos' Estimates; Lowers PT
In a recent research report published by Oppenheimer, Innophos Holdings' (NASDAQ: IPHS) operating income was modestly below model on a sharp $5M sequential decline in U.S./Canada.
Oppenheimer explained its reduction following this news: “The reduced '12E EPS outlook results in a $2 reduction to our price target to $57. Positively, investors will transition to '13E estimates, and GTSP, which is the source of the weakness and historically all the stock volatility continues to diminish in importance, being less than 6% of '12E income. This underscores the significant structural upgrade at IPHS in the past 18-months: 1) improving the product and customer mix to high-margin food, beverage, pharmaceutical and oral care; 2) geographic expansion into under-penetrated fast-growing markets; and 3) strengthening phosphate rock sourcing. IPHS remains attractive long term, generating significant cash, and sporting a relatively modest valuation.”
Oppenheimer maintains its Outperform rating on Innophos, which is currently trading at $50.72.
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