Goldman Sachs downgraded shares of Lehman Brothers (LEH) to market perform from market outperform.
Analyst Richard Strauss said that fundamentals at the brokerage company continue to deteriorate. He sees a continuation of choppy conditions for the group near term. He sees deceleration in fixed income, LEH's traditional sweet spot. Market conditions have played to some of company's key strengths; he thinks brokers with more formidable equity and merger franchises will offer investors more upside when other areas of capital markets eventually pick up, he said.
Strauss thinks the stock is no longer exceedingly inexpensive, and he would take some profits at current levels. He cut his EPS estimate from $5.85 to $5.47 for FY 01 (Nov).