UPDATE: Morgan Stanley Downgrades Hill-Rom Holdings to Equal-Weight, Removes $31 PT

In a report published Wednesday, Morgan Stanley downgraded its rating on Hill-Rom Holdings (NYSE: HRC) from Overweight to Equal-Weight, and removed its $31.00 price target.Morgan Stanley noted, “Our recent AlphaWise survey of 140 hospital executives points to increased deterioration in hospital CapEx (Exhibit 3). After small sequential declines from 1Q11 through 1Q12, the 2Q12 and 3Q12 surveys show a more substantial deceleration in CapEx growth expectations, falling below 2010 levels. Rentals are also pressured by hospital focus on controlling operating costs; therefore, we are lowering our FY2013 sales and EPS estimates to $1,764mn and $2.17, respectively, on slowing organic growth (flat vs. 1.5% previously) and increased interest expense related to the Aspen acquisition.”Hill-Rom Holdings closed on Tuesday at $30.16.