Markets & Finance

Analyst Actions: GE, eBay, Host Hotels


From Standard & Poor's Equity ResearchMERRILL CUTS GENERAL ELECTRIC EPS ESTIMATES

Merrill Lynch analyst John Inch says General Electric's (GE) CFO and top members of GE Capital are scheduled to talk tomorrow about the company's fundamentals and actions taken to improve Capital's positioning in 2009 and beyond.

Inch thinks a portion of the talks will be directed toward the company's ability to sustain $1.24 dividend payout through 2009, which he thinks GE will be able to do. He notes this has been a source of market concern in the past few weeks.

Still, he cuts EPS estimates to reflect incrementally worse industrial and financial services environment; he now sees $1.55 2009 EPS and $1.70 for 2010. He has a $21 price target on the stock.

STIFEL NICOLAUS CUTS EBAY ESTIMATES, TARGET

Stifel Nicolaus analyst Scott Devitt cuts estimates for eBay (EBAY) due to the current environment and the company's continued business model challenges.

Devitt cuts $2.2 billion fourth quarter revenue estimate to $2.1 billion, and maintains adjusted EPS at $0.40. He cuts $9.0 billion 2009 revenue estimate to $8.8 billion, $1.78 adjusted EPS to $1.69.

He notes that in a 4-year period, eBay's main marketplace business has gone from being core of eCommerce industry to more of a niche marketplace for unique and collectible items. He says eBay is trying to make its way back toward relevance with its diamond seller program and software platform dubbed Large Merchant Services.

He cuts $20 price target to $17. He keeps a buy opinion.

RBC CAPITAL DOWNGRADES HOST HOTELS TO SECTOR PERFORM FROM OUTPERFORM

RBC Capital analyst Mike Salinsky says rapid deterioration in Host Hotels & Resorts (HST) operating fundamentals over the past two months and the company's greater dependence on brand managed properties, which historically have been more rigid with regard to cost containment initiatives to limit margin erosion, now suggest even greater than previously anticipated earnings and EBITDA deterioration over the next several quarters.

Salinsky notes that demand is moderating across all segments. He cuts $1.79 2008 reported FFO/share estimate to $1.69, $1.25 for 2009 to $1.17, and $1.17 for 2010 to $1.08. He cuts $13 price target to $9.


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