D.A. Davidson Reiterates on Granite Construction

In a report published Tuesday, D.A. Davidson & Co. analyst John Rogers reiterated a Neutral rating on Granite Construction (NYSE: GVA), raising its price target from $30.00 to $35.00.

According to the report, “GVA expects to incur non-cash impairment charges in Q4 2013 of $39-$58 million, including amounts attributable to noncontrolling interests of $2.0-$4.0 million ($0.88-$1.40 per share net of noncontrolling interests).”

The charges reduce GAAP earnings for two segments:

-”Real estate segment charges of $26-$33 million, including amounts attributable to noncontrolling interests of $2.0-$4.0 million consisting of non-cash impairment of certain assets and accrual of lease termination costs.” -”Real estate segment charges of $26-$33 million, including amounts attributable to noncontrolling interests of $2.0-$4.0 million consisting of non-cash impairment of certain assets and accrual of lease termination costs.”

Above previous expectations the company had previously disclosed an impairment charge of “at least $30 million,” the report said.

“Although these restructuring expenses will reduce current earnings, we expect the charges will mark the near completion of the company's reorganization efforts and refocus the company on its core civil construction business,” the report said. “We continue to look for end-market demand for the industry and Granite's earnings to improve going forward (see our recent reports).”

GVA closed on Monday at $34.90.