Covidien’s Rating, Target, and Estimates Slashed at Goldman Sachs (COV)

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Healthcare products maker Covidien plc ( COV ) saw its rating, price target, and earnings estimates all cut on Tuesday by analysts at Goldman Sachs.

The firm lowered its rating on COV to "Neutral" from "Buy," citing small relative upside and lower earnings forecasts. As a result, Goldman cut its price target for the stock from $55 to $48. That new target represents a 15% upside to COV's Monday closing price of $41.81.

The analyst lowered its full-year 2010, 2011, and 2012 EPS forecasts $3.35, $3.72, and $4.23 to $3.19, $3.48, and $4.02, respectively.

Still, Covidien shares rose 22 cents, or +0.5%, in premarket trading Tuesday.

The Bottom Line
We had removed shares of COV from our recommended list back on October 6, 2008, when the stock was trading at $52.19. The company has a 1.72% dividend yield, based on last night's closing stock price of $41.81. The stock has technical support in the $38-$40 price area. If the shares can firm up, we see overhead resistance around the $44-$46 price levels. We would remain on the sidelines for now.

Covidien plc ( COV ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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