UPDATE: JP Morgan Cuts PT to $40 on KBR on Intensifying Execution Risks
JP Morgan reiterated its Overweight rating on KBR (NYSE: KBR) but lowered the price target from $44.50 to $40.00.
JP Morgan commented, "KBR provided initial 2013 guidance that was marginally below consensus, but unexpectedly lowered 2012 guidance to reflect contract charges and labor cost absorption headwinds. We lower estimates accordingly, and while execution could remain a near-term overhang, we think risk-reward remains favorable, longer-term, given attractive growth potential and a sizable discount to peers. … We lower 2012-13E EPS toward the middle of new guidance (2012: $1.95-2.10, 2013: $2.45-2.90), and assume a more back-ended 2013 than before."
KBR closed at $29.48 on Friday.
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