Goldman Sachs Reiterates Sell on Itron

Goldman Sachs reiterated its Sell rating on Itron (NASDAQ: ITRI). The company is having a rough time and it has started a restructuring plan. Goldman does not seem to be persuaded that the company's plan will produce immediate results, however.

In a research report published today, Goldman states, "We rate ITRI shares Sell with 16% downside to our $45 12-month target and believe execution is needed to increase confidence in the targeted five-year reset. We believe these aspirational goals will require a delicate balance between: (1) managing down costs in its larger base of 'book & ship' meters as volumes and ASPs decline; while (2) building market share in new regions/products. With the ramp in European AMI likely to occur in 2013+, we see limited EPS upside and reasons for those not currently involved to invest at these levels. Longer term, we remained focused on the impact on ROIC as Itron pursues an aggressive growth plan via organic and substantial inorganic growth. Recent industry M&A supports the company's view that financial strength matters more as the industry grows."

At the moment, Goldman has a price target of $45 on Itron. On Thursday, Itron added 0.93% to its value to close the day at $53.42. Its shares lost all of yesterday's gains in today's pre-market trading, however, falling $2.98% to $51.83.