Goldman Sachs Maintains Sell on Itron (ITRI)

Goldman Sachs is out with its report today on Itron ITRI, maintaining Sell. In a note to clients, Goldman Sachs writes, "We rate ITRI shares Sell and see 18% downside to our unchanged 12-month price target of $45. We view the company's strong financial management – including steady deleveraging – positively, but maintain our Sell rating owing to (1) notable inertia across domestic utilities (with N.A. bookings ex-BC Hydro at a multi-yr low), (2) a likely drop in book-and-ship orders as European utilities finalize AMI plans, and (3) possible margin pressure from ASP declines and/or raw material price increases. The company appears to be making the best of a challenging environment, but will need to see similar yoy margin expansion through the balance of 2011 without commensurate revenue growth to meet EPS expectations." At the time of posting, shares of ITRI were trading pre-market at $53.80, down 2.50% from Wednesday's close.