UPDATE 1-RESEARCH ALERT-Goldman cuts Rockwell Collins to sell
* Slashes price target to $46 from $57
* Says co's exposure to "difficult" defense market a worry
* Shares down 3 percent
June 20 (Reuters) - Goldman Sachs downgraded shares of Rockwell Collins Inc to "sell" citing the aircraft parts supplier's exposure to a "very difficult" defense market and slowing rates of aftermarket growth.
Analyst Noah Poponak said he expected limited to no growth for the company over the next several years.
Rockwell, which supplies avionics and other electronic systems for commercial and military planes, has felt the sting of tighter times over the past year as several of its defense programs were canceled due to U.S. budget cuts.
Sales to government agencies, which contribute 54 percent to the company's revenue, have fallen for four straight quarters.
The brokerage, which cut its price target on the stock to $46 from $57, expects Rockwell Collins's June-quarter results to miss analysts' expectations.
It sees the company "potentially" lowering its fiscal 2012 earnings guidance.
Rockwell in April maintained its 2012 profit forecast of $4.40 to $4.60 per share from continuing operations.
"We also expect the company to either provide initial FY2013 guidance well below consensus ... or it could possibly skip providing guidance and attribute it to significant uncertainty in its end markets," Poponak wrote in a note to clients.
Shares of the company were down 3 percent at $48.83 in early trading on Wednesday on the New York Stock Exchange.
- Tweet this
- Share this
- Digg this