J.P. Morgan Maintains Neutral Rating On DNB

J.P. Morgan is maintaining its Neutral rating on shares of Dun & Bradstreet Corp. DNB. “In Q1,11, revenues grew 2% (up modestly organic) while profits fell 4%. EPS of $1.13 (incl. ~$0.16 Tech investment) topped JPM's $1.08 estimate,” J.P. Morgan writes. “Revenues were light of our estimates with the US and International both flat. Only modestly better performance is likely in Q2,11, and Japan (~20% of Intl. revs.) could be a further drag. But management is encouraged by macro trends, especially C&I loan volume which can spur demand for D&B's data. “Revenues are expected to strengthen in Q3/Q4 as Risk subscriptions recover, DNBi ramps in Europe, and new products (D&B360, DNBi Pro, etc.) gain traction. 2011 guidance was reiterated—revs. +5- 8% (2-5% organic) and EPS +6-10% (or $6.00-6.25 before ~$0.40 of Tech costs. We view the high end of the rev. guidance as a stretch, and the low end doesn't look like a lay-up.” Dun & Bradstreet currently trades at $81.62.