UPDATE: Sterne Agee Lowers Willis Group's PT

According to a research report published earlier today, Sterne Agee has lowered Willis Group Holdings'

PT from $40 to $37 as a reflection of the reduction in earnings forecasts. Sterne Agee also lowered EPS estimates in the report, saying, “We are lowering our 2012 and 2013 estimates to $2.65 and $3.00 from $2.85 and $3.25, respectively. The decrease primarily reflects lower margin (higher expense levels) than our previous forecast. Our estimates compare to consensus forecasts for 2012 and 2013 of $2.85 and $3.21, respectively. The company's 2011 adjusted operating EPS of $2.75 included about $0.14 of benefit from non-recurring items including release of legal reserves, tax benefits, and change in organic calculations. Adjusting for these items we put the full year 2011 core EPS at closer to $2.61. Our 2012 estimate implies about 2% growth versus 2011 core earnings. We would note management expects FX to be about a $0.05 to $0.10 headwind in 2012 assuming current exchange rates.” Sterne Agee maintains its Underperform rating on Willis Group, which closed Friday at $35.27.