Markets & Finance

Analyst Actions: Mosaic, Con-Way, Akamai


From Standard & Poor's Equity ResearchMERRILL DOWNGRADES MOSAIC, OTHERS IN AGRICULTURE GROUP

Merrill Lynch analyst Donald Carson says he is downgrading Mosaic Company (MOS), Potash (POT), Agrium (AGU), Intrepid Potash (IPI), CF Industries Holdings (CF) and Terra Industries (TRA) to underperform from buy on uncertainty about near-term EPS outlook from lower-priced corn.

Carson says while the stocks remain inexpensive, they appear to be driven more by price and EPS momentum than by valuation. He notes with phosphate prices falling, nitrogen prices peaking and potash prices rising less than expected, there is considerable uncertainty surrounding the near-term EPS outlook as underscored by Mosaic's EPS miss and lower guidance.

He says the near-term fertilizer demand outlook is now more uncertain.

STIFEL DOWNGRADES CON-WAY TO HOLD FROM BUY

Stifel analyst David Ross says Con-Way (CNW) cut second half 2008 EPS view by 30% on weak freight volumes and tough pricing.

Ross notes that pricing at Freight has gotten more competitive, even as fuel surcharges have fallen. Also, Truckload is still growing but performing below prior estimates due more so to volume than pricing.

He says while the stock may end up higher next fall than yesterday's close, it will likely have further downside near term. Given the company's guidance, he cuts his rating and EPS estimates for 2008 to $2.70 from $3.30 and 2009 to $3.20 from $4.05.

WEDBUSH CUTS AKAMAI TECHNOLOGIES TO HOLD FROM BUY

Wedbush analyst Kerry Rice says recent industry and customer checks indicate that the economy and competition could diminish financial performance at Akamai Technologies (AKAM), resulting in weaker-than-expected 2009 guidance.

Rice expects traffic growth for AKAM's media and entertainment (M&E) segment to remain challenged as the economy decelerates Internet initiatives of large traditional M&E companies and competition gains traction.

The analyst trims $1.63 2008 EPS estimate to $1.62 and $1.87 for 2009 to $1.81. Rice also lowers $23 target price to $20.


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