UPDATE: Morgan Stanley Downgrades St. Jude Medical to Equal-Weight on Pipeline Outlook

Morgan Stanley lowered its rating on St. Jude Medical

from Overweight to Equal-weight and removed its previous $52 price target. Morgan Stanley commented, "We are downgrading to Equal-weight with a base case of $42 because the growth acceleration component of our thesis is less likely to materialize. … A weaker pipeline outlook and slower CRM recovery make 2013 sales acceleration less likely. Our prior view was based on a five year pipeline analysis, but required near-term catalysts to improve visibility. We expected a CRM recovery and pipeline execution to drive a sales growth inflection into 2013 and subsequent multiple re-rating. Diligence at the TCT cardiology conference reduced our enthusiasm for multiple pipeline programs, and CRM remains sluggish." St. Jude Medical closed at $38.29 on Friday.