J.P. Morgan Maintains Underweight Rating, $12 PT On MAS

J.P. Morgan is maintaining its Underweight rating on shares of Masco Corporation MAS, “based on our below-Street estimates and our outlook for a longer earnings recovery, in our view, than investors currently expect.” J.P. Morgan is maintaining its Dec. 2011 price target of $12.00. “We point to our lowered 2011E of $0.16 (previously, $0.43) and our 2012E of $0.58, below the Street's $0.33 and $0.66, respectively, as near-term challenges for the stock,” J.P. Morgan writes. “Moreover, given our outlook for continued losses in Cabinets and Installation through 2012, we believe a full earnings recovery to "mid-cycle" should take longer than many investors currently expect. At 9.5x our 2011E EBITDA, a 6% premium to its 5-year average and a 27% premium to its peers' 7.5x average, MAS' valuation is also somewhat expensive, in our view.” Masco Corporation closed Friday at $13.30.