Deutsche Bank Updates Views On Auto Industry

Deutsche Bank is updating their sales and production forecasts to reflect a more conservative trajectory of U.S recovery. There has been modest adjustments to earnings estimates and targets buy no changes to ratings. Because expectations are now increasingly incorporating weak/recessionary demand levels through 2011, DB believes that the Street should become somewhat less concerned about risks of additional volume shortfalls. There has also been a risk of intensifying price competition in several important markets, mainly in Europe and China. Buy recommendations still appear to have the biggest risk/reward profiles. Some of these stocks include Cooper Tire CTB, Lear LEA, Dana DAN, and Johnson Controls JCI. while there may be a weak recovery for the US, strong profitability is seen. Structural changes in the American Auto Industry, including meaningful capacity reduction across the value chain will support historically strong profitability over the intermediate term. CTB closed Friday at $18.14 LEA closed Friday at $71.56 DAN closed Friday at $10.50 JCI closed Friday at $28.43