Morgan Stanley Cuts Keane to Equal-Weight
Morgan Stanley downgraded Keane (KEA) to equal-weight from overweight, noting management uncertainty.
Analyst Julie Santoriello says that an article in the Boston Globe earlier this week revealed that a CEO search is underway, and expected to take 3 to 6 months while the company's board of directors considers both internal and external candidates. She does not see much downside risk to shares, but is concerned the stock could languish during an extended CEO search. She believes this casts doubt on the future pace of Keane's turnaround. She cut her price target to $14 from $17. She sees 73 cents 2006 earnings per share (EPS) and $1.00 in 2007.
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