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Good morning. Here’s your daily roundup of equity research from the Street.Bank of America Merrill Lynch:
Sherwin Williams (SHW): BofA downgraded Sherwin Williams shares to Underperform from Neutral, with a price target of $122. They currently trade at a 63 per cent premium against peers in the coatings industry, a valuation that leaves little room for error. The hope for a cyclical upturn in the U.S. housing market might fail to materialise should markets remain depressed.
Google (GOOG): JP Morgan reduced price targets for a host of internet companies including Amazon and eBay on their exposure to international FX and macro concerns. Another area of concern for the sector is the weakness shown by newer Internet companies this year. Google saw the largest PT drop in the group, down to $670 from $730.
Brazilian Banks: Morgan Stanley reduced price targets on three Brazilian banks, Banco Bradesco, Banco do Brasil, and Banco Santander Brasil. Slower growth, an expected ROE decline from 16 to 15 per cent, and pressure on credit spreads could push profitability to new lows.
Microsoft (MSFT): Microsoft announced that those who buy Windows 7 PCs through January 31st of next year will receive a coupon to buy Windows 8 for $14.99. The accounting implications of this program and weakening European demand leads UBS to reduce 2012 EPS estimates to $2.67 from $2.71 and to increase estimates for 2013 from $3.10 to $3.13. Buy rating maintained, with a price target of $37.
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