An analyst today downgraded shares of aerospace and industrial components maker Barnes Group Inc. because of slowing sales growth and concerns that profit margins will shrink.
Robert W. Baird analyst Peter Lisnic said in a client note he downgraded the Bristol-based company’s shares to “neutral” from “outperform” and cut its price target to $17 from $26.
Barnes Group announced Friday third-quarter earnings rose 8.5 percent to $28.9 million, or 51 cents a share.
Lisnic said the drop in Barnes’ third-quarter organic growth rate to minus 7 percent was “somewhat surprising. Clearly macroeconomic pressures have started to impact demand, with the company noting softer year/year sales in all three reporting segments.”
The analyst expects further sales declines through 2009, “although given the rapidly changing macroeconomic environment and declining expectations for global growth rates, we remain concerned about the potential magnitude of declines in 2009, and the resulting detrimental impacts to profitability.”
Other analysts were not as downbeat. Oppenheimer’s Christopher Glynn reiterated his “outperform” rating, though he did trim his price target to $23 from $27 and his 2008 earnings-per-share estimate to $2.17 from $2.25. Analysts surveyed by Thomson Reuters expect, on average, $2.19.
Similarly, Jefferies analyst Yvonne Varano maintained her “buy” rating while reducing her 2008 earnings-per-share estimate to $2.07 from $2.23.
At 11 a.m., Barnes’ shares traded at $14.05, down 46 cents, or 3.2 percent. (AP)
