) to neutral from strong buy.
On Tuesday the company forecast breakeven Q2, and $0.90-$1.10 EPS for 2001 from operations. Analyst Kevin Murphy says the weak air cargo sector has resulted in a significant underutilization of Cargo's fleet and staff. He notes management has taken the only prudent moves it can: the company reduced staff by 200 ground personnel and grounded six aircraft.
Murphy cut the $2.30 2001 EPS estimate to $1.00. He notes that with much of Cargo's freight having international origins, it is likely that any recovery in this sector will lag that of the U.S. Accordingly, he also cut the $2.70 2002 EPS estimate to $1.50.