J.P. Morgan Cutting Estimates On H.B. Fuller (FUL)

J.P. Morgan Chase & Co. is cutting estimates on H.B. Fuller FUL and is cutting its price target to $22 from $23. It has a Neutral rating on shares. In a note to clients, J.P. Morgan writes, "Fuller is contending with raw material cost inflation. Fuller was able to lift its average prices by 6.8% y-o-y during F1Q:11, which was not enough to offset the estimated raw material inflation of 17%. Consolidated sales grew 9.7% in F1Q:11, gross profits contracted (0.8%), and the gross margin slipped 310 bps from 31.6% to 28.5%. FUL lifted its sales growth target to 10-12% from 8-10% previously reflecting additional price increases to offset raw material cost inflation. FUL forecast raw material cost inflation of 14% for F2011 versus 10% previously." Shares of FUL lost 12 cents yesterday to close at $20.79, a loss of 0.6%.