UPDATE: Rodman & Renshaw Initiates Market Perform on Ducommun; Transformation Underway
Rodman & Renshaw initiates its coverage of Ducommun (NYSE: DCO) with a Market Perform rating and no price target.
Rodman & Renshaw notes, "Recent financial performance has been impacted by a decline in volumes for certain military platforms, new commercial program ramp-up costs and a slowdown in activity with a large industrial customer. We expect ~30% revenue growth for 2012, driven primarily by the incremental contribution from the LaBarge acquisition. Operating margins should improve sequentially as new program ramp-up costs ease. We are modeling a y/y decline in EPS resulting from higher interest expense related to acquisition financing. In 2013 we anticipate mid-single digit revenue growth driven largely by increasing commercial aircraft production coupled with improving margins and the benefits of debt reduction on interest expense leading to strong EPS growth."
DCO closed at $8.82 on Wednesday.
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