Benzinga's Top Downgrades With Color for May 3, 2012

Listed below are today's Top Downgrades at Benzinga:

: Citi commented in the report, "We are downgrading CHKM to Neutral and reducing our TP to $29/unit as we believe the partnership's risk profile has increased following the extreme stock price volatility of Chesapeake Energy (CHK.N; US$16.74; 2), the partnership's general partner and largest customer. Importantly, we are not drawing any conclusions as to the ultimate fate of CHK. However, it seems prudent to look at the potential impacts on the partnership should recent volatility lead to something more operationally material."

: Bank of America Merrill Lynch

stated, "We believe investors are becoming increasingly concerned by VC's financial reporting, which we think makes comparison to prior results and forecasts challenging. Furthermore, the company's lack of explicit actionable strategic roadmap is we think adding to investor concerns. While we believe VC may ultimately drive shareholder value by executing strategic actions (ie the purchase of Halla's 30% stub), similar discussions have been underway for over a decade with only small progress."

: Credit Suisse notes, "Organic sales growth in FQ3'12 was -1.5%, marking the first quarter of organic decline in 5 years. Weakness was attributed to lower pass through of ODCs, which are low profit, subcontracted goods. However, we worry that this pressure will eventually move to the more profitable direct labor portion of the business, as it has already with certain peers. We reduce our 2012/13/14 forecasts from $5.92/$6.13/$6.66 to $5.65/$5.26/$5.42, but note that our projections do not incorporate future acquisitions, which could mitigate some downside."

: Piper Jaffray stated, "We remain confident in the ongoing consumer transition to and adoption of single-serve coffee, and while we recognize Green Mountain's prior successes we believe it is prudent to revisit our long-term expectations. In light of what appears to be a sooner-than-expected flat-lining of the company's sales growth trajectory, in particular as it pertains to sales of its current brewer ecosystem and house K-Cup brands, we are taking this opportunity to revise our long-term model. We are also lowering our rating to Neutral and price target to $40 on GMCR shares."