J.P.Morgan Downgrades GeoEye, Inc. To Neutral (GEOY)

J.P.Morgan is out with a report, where it has downgraded GeoEye, Inc. (GEOY) to “neutral” from “overweight”, and has set a price target at $37.00. YTD, GEOY has increased 25.9%. The analysts at J.P.Morgan noted, “Growth in 2011-2012 could be slow relative to 2009-2010, when GEOY experienced a step-function increase in revenue and EBITDA owing to the launch of GeoEye-1.” J.P.Morgan mentions, “We believe GEOY is appropriately valued and expect the stock to perform in line with the mean of our coverage universe and to underperform near-peer DGI over the next 6-12 months. GEOY is trading at an EV of 6.8x adjusted CY11 EBITDA, a 6% premium to DGI, unjustified, we believe, given that DGI should experience a more immediate benefit from the pending EnhancedView contract.”