UPDATE: J.P. Morgan Reiterates Neutral Rating, Lowers PT on UTi Worldwide
In a report published Friday, J.P. Morgan & Co. reiterated its Neutral rating on UTi Worldwide (NASDAQ: UTIW), but slightly lowered its price target from $16.00 to $15.00.
J.P. Morgan noted, “UTIW's downside 2QF13 report showed underperformance in both Forwarding segment EBIT and Contract Logistics segment EBIT. This is a different pattern than we have seen in recent quarters when at least one segment has outperformed. In particular, this may show that after the strong profitability improvements made in the Contract Logistics segment that meaningful additional gains may be harder to achieve. Additionally, our sense is that weak volume trends, especially in airfreight, are unlikely to turn quickly other than just as a result of easier comps; and airfreight yield expansion could be harder to achieve in F3Q owing to consumer tech product launches for which shippers have contracted charter capacity. We are lowering our EPS forecasts modestly to reflect the impact of these factors.”
UTi Worldwide closed on Thursday at $14.55.
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Tags: J.P. Morgan & Co.