UPDATE: J.P. Morgan Reiterates Underweight Rating, Lowers PT on Allegheny Technologies on Pre-Announced 1Q13 Earnings

In a report published Wednesday, J.P. Morgan analyst Michael F. Gambardella reiterated an Underweight rating on Allegheny Technologies

, but lowered the price target from $24.00 to $20.00. In the report, Gambardella noted, “On April 16 ATI pre-announced 1Q13 earnings of $0.09 per share, which fell well short of consensus estimates of $0.23 and even our bearish $0.17 view. The company expects 1Q13 sales to fall in line with consensus at $1.18B, which highlights the emergence of significant margin pressure in stainless steel central to our Underweight thesis. Management retained its positive secular view on key end markets and expected benefit from the $1.1B Hot-Rolling and Processing Facility but did not reiterate its prior outlook for improving fundamentals in 2H13. In our view, this incrementally negative commentary undercuts the consensus view, which relied on the back half of 2013 to contribute 60% of full-year earnings prior to the 1Q miss. We reiterate our contrarian Underweight recommendation on ATI shares and cut our Street-low 2013 and 2014 EPS estimates further while lowering our December 2013 price target to $20 from $24 ahead of larger anticipated negative earnings revisions on the Street.” Allegheny Technologies closed on Tuesday at $28.01.