Copa: Strong Quarter, But Poor Guidance Leads To Analyst Downgrades

Copa Holdings CPA reported its second quarter results after market close on Wednesday. The company beat estimates on revenue and earnings per share, but fell short on guidance.

The Panama-based company earned $2.61 per share, good for a $0.39 beat while revenue of $673.6 million topped estimates by $6.24 million. However, Copa revised its operating margin guidance for the year down to a range of 18 percent to 20 percent from a previous 19 percent to 21 percent.

According to Copa, the downward revision was due to capacity reductions the company is making in Venezuela and a transition to more non-bolivar sales.

Analysts are responding negatively to Copa's report Thursday morning. Analysts at Raymond James downgraded shares to Market Perform from Strong Buy while removing a $167 price target. Joining Raymond James in a downgrade was Evercore, which downgraded shares to Equal-weight from Overweight with a price target lowered to $150 from a previous $160.

Analysts at Deutsche Bank highlighted Copa's strong quarterly figures, but pointed at the reduced fiscal 2014 outlook, while maintaining a Buy rating and $180 price target.

Shares of Copa were recently trading at $132.25, down 10.3 percent.