Moody's (NYSE:MCO) downgraded EXCO Resources (NYSE:XCO) from "Positive" to "Developing" on the proposed buyout of the company and taking it private being a distraction to management.
Other agencies joined the downgrade bonanza, with Morgan Keegan downgrading them from "Outperform" to "Market Perform," MBO Capital downgraded them from "Outperform" to "Market Perform" as well, and Scotia Capital also downgraded XCO from "Sector Outperform" to "Sector Perform."
Price targets stood at $20 from Morgan, increased from $17 to $21 by BMO, and from $20 to $20.50 by Scotia.
Standard & Poor's Rating Service put the "BB-" corporate credit rating and "B" senior unsecured debt rating on negative credit watch.
Ratings could be lowered depending on the success of the takeover and how the financing is structured, concluded Standard & Poor's.
Moody's sees the process itself as being detrimental to the company, no matter what the ultimate terms of the deal may end up being.
Showing posts with label Morgan Keegan. Show all posts
Showing posts with label Morgan Keegan. Show all posts
Wednesday, November 3, 2010
Tuesday, October 19, 2010
Copano Energy (Nasdaq:CPNO) Distribution Rates Slowing
Saying the slower distribution rates of Copano Energy (Nasdaq:CPNO), they should underperform their peers, said Barclays (NYSE:BCS), which downgraded them from "Overweight" to "Equalweight."
"We downgrade CPNO due to slower distribution growth prospects compared to its Overweight rated peers: Given expected tight distribution coverage in 2010 and 2011 we estimate CPNO will leave its distribution flat and resume growth at 2-5% level in 2012-2014, based on our assumption that it can successfully deploy $150-200 mm of growth capital per year at 5x return multiple. While this requires strong execution skill, which CPNO has demonstrated in the past, we note that CPNO's growth forecast falls below our Overweight rated G&P MLPs that have either started to raise distribution or should be in a position to raise distribution in 2011 and beyond by 5-10% range," said Barclays.
Earnings per share estimates were lowered by Barclays for FY11 from $0.06 to -$0.09 and FY12 from $0.46 to $0.26.
Morgan Keegan also downgraded them from "Outperform" to "Market Perform."
Copano closed at $28.76, falling $0.80, or 2.71 percent.
"We downgrade CPNO due to slower distribution growth prospects compared to its Overweight rated peers: Given expected tight distribution coverage in 2010 and 2011 we estimate CPNO will leave its distribution flat and resume growth at 2-5% level in 2012-2014, based on our assumption that it can successfully deploy $150-200 mm of growth capital per year at 5x return multiple. While this requires strong execution skill, which CPNO has demonstrated in the past, we note that CPNO's growth forecast falls below our Overweight rated G&P MLPs that have either started to raise distribution or should be in a position to raise distribution in 2011 and beyond by 5-10% range," said Barclays.
Earnings per share estimates were lowered by Barclays for FY11 from $0.06 to -$0.09 and FY12 from $0.46 to $0.26.
Morgan Keegan also downgraded them from "Outperform" to "Market Perform."
Copano closed at $28.76, falling $0.80, or 2.71 percent.
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