Masco Downgraded to “Sell” at Goldman Sachs; Expects 15% Downside (MAS)

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Home and building products maker Masco Corporation( MAS ) on Wednesday caught a big downgrade from analysts at Goldman Sachs, sending its shares lower in premarket trading.

The firm cut its rating on MAS from "Neutral" to "Sell" with a $10 price target. That target represents an expected 15% downside to the stock's Tuesday closing price of $11.82.

Goldman said it feels Masco's current 2011 consensus earnings estimates are 33% too high - Goldman expects the company to earn 41 cents for the year, while the average Wall Street estimate sits at 62 cents. A Goldman analyst commented, "Masco's key businesses will face margin pressure in 2011 via higher copper, zinc, insulation and titanium dioxide prices."

Masco shares fell 22 cents, or -1.9%, in premarket trading Wednesday.

The Bottom Line
We removed shares of MAS from our "recommended" list last Sept.23, when the stock was trading at $17.87. The company has a dividend yield of 2.54%, based on last night's closing stock price of $11.82. The stock has technical support in the $10 price area. If the shares can firm up, we see overhead resistance around the $13 price level. We would remain on the sidelines for now.

Masco Corporation( MAS ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.0 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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