Equity Brief: Ratings Changes for November 7th: NWSA, OFC, ONE, PAA, PCL, QLTY, RIG, ROK, RRD
Credit Agricole upgraded shares of News Corp (NWSA) from an outperform rating to a buy rating.
Raymond James downgraded shares of Corp Office Props (OFC) from an outperform rating to a market perform rating.
Credit Suisse downgraded shares of Higher One Holdings, Inc (ONE) from an outperform rating to a neutral rating.
JMP Securities downgraded shares of Higher One Holdings, Inc (ONE) from an outperform rating to a market perform rating.
Zacks reiterated its neutral rating on shares of Plains All Amer (PAA). They have a $48.00 price target on the stock. Zacks' analyst wrote, "Plains All American Pipeline L.P. results in third quarter surpassed the Zacks Consensus Estimate and the year-ago figures primarily owing to strong performance from its operating segments. The partnership benefited from acquisition, higher pipeline tariffs and volumes, and completion of several organic growth projects. These positives were partially offset by increase in operating, and general and administrative expenses. Plains intend to deploy over $1.0 billion in its several organic growth projects through 2013. We believe these initiatives will further enable the partnership to strengthen its existing operations to serve major U.S. refinery and distribution markets. However, we are cautious about commodity price fluctuations, and stringent regulations and higher costs which can slower the pace of drilling and development activities."
Zacks downgraded shares of Plum Creek Timber Co. (PCL) from an outperform rating to a neutral rating. Their analysts now have a $45.00 price target on the stock. Zacks' analyst wrote, "Plum Creek reported modest third quarter 2012 results with earnings in line with the Zacks Consensus Estimate. Plum Creek is the largest publicly-held timber REIT, with a diversified timber and land base that enables it to benefit from large economies of scale. In addition, the upsurge in demographic trends driving housing markets and demand for real estate properties across the country provides a strong economic backdrop for the company to demonstrate solid financial performance in the future. However, cyclical nature of the business, cutthroat competition, and strict environment policies undermines its long-term growth potential to some extent. We are changing our recommendation for Plum Creek from Outperform to Neutral based on downward earnings estimate revisions. "
SunTrust downgraded shares of Quality Distribution, Inc. (QLTY) from a buy rating to a neutral rating.
JPMorgan Chase downgraded shares of Quality Distribution, Inc. (QLTY) from an overweight rating to a neutral rating. They wrote, "QLTY's 3Q EPS result was very weak and commentary regarding 4Q was downbeat. The 3Q results point to a much lower EPS run rate than we had been anticipating looking to 2013. Aside from the weakness in the base business exhibited in 3Q, our sense is that recent acquisitions, which had been a key to our Overweight thesis, may not be as profitable as we previously hoped owing to higher asset purchase accounting allocations and potentially lower utilization than we expected. And given this, we believe QLTY may slow its planned acquisition activity and focus instead in debt reduction. We do expect QLTY to continue to show better performance in its Chemicals Logistics business as it gradually ramps up the number of drivers and it faces easier driver comparisons; however, this expectation already resides in our estimates. For these reasons, we believe reward-to-risk will be fairly balanced - after what we expect to be an initial meaningful move down in QLTY stock in reaction to the 3Q result and 4Q outlook - and we lower our rating on QLTY to Neutral (from Overweight)."
Jefferies Group reiterated its buy rating on shares of Transocean (RIG).
Credit Suisse raised its price target on shares of Rockwell Automation Inc (ROK) from $78.00 to $85.00. They have an outperform rating on the stock.
RBC Capital raised its price target on shares of Rockwell Automation Inc (ROK) from $80.00 to $93.00. They have an outperform rating on the stock.
MKM Partners raised its price target on shares of Rockwell Automation Inc (ROK) from $67.00 to $78.00. They have a neutral rating on the stock.
Zacks reiterated its neutral rating on shares of R.R. Donnelley & Sons Company (RRD). They have a $11.00 price target on the stock.
Imperial Capital raised its price target on shares of Ryanair Holdings plc (RYAAY) from $36.00 to $40.00. They have an outperform rating on the stock. They wrote, "Maintaining our Outperform rating and raising one-year price target to $40 from $36.We believeF2Q's results demonstrate that Ryanair is among the fiercest competitors in the European market, exploiting its low-cost advantage and luring passengers with its exceptionally low fares. We believe the wave of European airline bankruptcies is far from over and expect Ryanair to not just pick up passengers, but also, potentially, very attractively-priced aircraft from the ashes. Quarter ended 9/30/12 results handily beat expectations.Ryanair reported second quarter EPS of €0.34 versus our €0.29 estimate and consensus of €0.24. While costs were consistent with our expectations, total revenue grew 17% year-over-year (yoy) to €1.8bn, which led to the €0.05 outperformance versus our model. Ryanair's scheduled revenue per passenger was €2.50 higher than our forecast, due to slowing capacity growth. Although cost per passenger excluding fuel increased 6%, the increase in the average fare drove a 100bp increase in operating margin to 31.9%. Guidance raised significantly.Ryanair increased guidance to €490-520 from €400-440. The company will again park approximately 80 planes during the winter, when demand is seasonally weak. Ryanair saves on fuel and landing fees using this approach, in addition to lifting the average fare on its remaining flights. Additionally, RYAAY is expecting full year fuel costs to increase only by €260mn, versus prior guidance of a €300mn increase. The company has been actively managing its fuel costs by ensuring pilots and ground crew adhere to policies that have helped RYAAY improve its fuel efficiency, such as flying slightly more slowly. Ryanair's costs are low even when compared to Spirit Airlines in the U.S.RYAAY's costs have long been well below other European flag carriers. Its costs are also well-below the U.S. ultra-low-cost carriers, like Spirit Airlines. The company estimates its costs are less than half those of Spirit, driven by much lower staff and airport costs. As we have written previously, Ryanair works aggressively to ensure that airport costs are low, partly by choosing the second or third airport in a city (like the Hahn airport instead of Frankfurt's main airport). The company also commented that because other nontraditional carriers are failing across Europe, airports not previously interested in Ryanair are now actively pursuing the carrier. We believe Ryanair still has plenty of growth left as more airlines exit and nascent markets such as Poland mature."
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Source: Equity Brief via Thomson Reuters ONE