Forest City Enterprises downgraded to "sector perform"

09/14/07 - RBC Capital Markets

NEW YORK, September 14 (newratings.com) - Analyst Rich Moore of RBC Capital Markets downgrades Forest City Enterprises (FCE.A) from "outperform" to "sector perform," while reducing his estimates for the company. The target price has been reduced from $80 to $54.

In a research note published this morning, the analyst mentions that the company’s Commercial Group business has reported its 2Q07 NOI short of the expectations. The 2007 and 2008 estimates for Forest City Enterprises’ land sales to home builders have been reduced from $34.6 million to $15.2 million and from $41.5 million to $26.0 million, respectively. The company has an aggressive balance sheet in a challenging financing environment, the analyst says. The reported FFO per share estimates for 2007 and 2008 have been reduced from $2.76 to $2.52 and from $3.12 to $2.68, respectively.