Goldman Sachs Dumps GE for Lockheed (LMT, GE)
April 14, 2008 by Douglas A. McIntyreThis morning, Goldman Sachs has made a key call to its industrials sector. It is adding Lockheed Martin (NYSE: LMT) to its Industrials Favorite Value List. Goldman Sachs notes the nature of defense stocks versus industrials in a recession, expectations for a solid earnings report next week, current prices representing a solid entry point. The firm also believes that Lockheed martin is the cheapest of the large cap defense stocks, and its $122 target implies a 20% upside in the stock at current levels.
While removing General Electric Co. (NYSE: GE) from this list is post-event, it’s really hard to argue with the level of disappointment and game-changer that its earnings miss and earnings warning posed on Friday. GE is noted as pointing to soft healthcare equipment spending as well.
We noted this on our "Top 10 Pre-Market Calls" as well, but General Electric was downgraded to Perform from Outperform at Oppenheimer it was also downgraded to Peer Perform from outperform at Bear Stearns.
Jon C. Ogg
April 14, 2008
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