SunTrust Downgrades Belden As 'Catalysts Seem More Negative'

Close on the heels of Belden Inc. (NYSE: BDC) shares hitting a 52-week high of $75.91 on September 2, SunTrust analyst William Stein downgraded the stock to a Neutral rating. The comments come in the wake of the stock recording more than 50 percent gain in the year-to-date period ending September 6.

The brokerage sees more negative catalysts for Belden than positive after pointing out that the stock staged a smart recovery delivering two beat and raise quarters thus doubling the stock from the trough witnessed in February. The results boosted NTM P/E to 14x from 11x. In the last four quarters, the company's earnings provided positive surprise ranging between 2.7 percent and 22.2 percent. In 2015, the stock underperformed.

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In a research note, SunTrust said, "We believe updates in Broadcast, Cybersecurity, and M&A will become more challenging from here, so we downgrade and wait for a better entry point."

The brokerage reduced its EPS estimate for the current year from $5.60 to $5.25 and for next year from $5.97 to $5.16. Therefore, the analyst slashed its price objective from $84 to $79 based on its estimated EPS for next year in addition to an estimated M&A accretion of $0.50.

Following the news, the stock traded down by $2.64, or 3.56 percent, to $71.54 on Wednesday.

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