J.P Morgan Comments On Itron Following Disappointing Guidance; Lowers PT

Itron ITRI reported 4Q results that approximately aligned with expectations adjusting for one-time items, but this was not a clean quarter and ITRI will probably not get credit for a record year with PF EPS up 88% on 34% sales growth. Guidance for 2011 captures consensus EPS expectations, but only just, and a flattish revenue outlook is disappointing in J.P Morgan's view, though it applauded management's commitment to eke out EPS growth. The overall narrative is constructive; ITRI believes its competitive position in electric AMI is stabilizing, the European AMI opportunity, gas and water, remain in the pipeline, the balance sheet is strengthening, and the firm's strategic flexibility is improving. J.P Morgan is trimming 2011-2012 estimates to align with guidance. J.P Morgan's price target goes from $95 to $80, and it maintains its Overweight rating; however, it is removing ITRI from the J.P. Morgan Analyst Focus List to reflect its view that the lacks near-term catalysts and near-term momentum has slowed. ITRN closed Wednesday at $63.62