Ashland (NYSE:ASH), like many companies, are dependent on a sustainable and legitimate recovery to grow in the future, and pressures from their low Valvoline margins will have the company struggling, even as other segments in the company do well.
Jefferies has lowered their earnings estimate on the company, while maintaining their "Buy" rating.
Jefferies said, "While near-term margin pressure in Valvoline may balance recoveries in other segments, we reiterate our Buy rating based on Ashland's significant operating leverage to a recovery and robust free cash flow."
EPS estimates were lowered for full year 2011 from $4.05 to $3.95 and from $4.65 $4.60 for full year 2012.
Revenue estimates for full year 2011 were increased from $5.5 billion to $5.6 billion and for full year 2012 from 5.79 billion to $5.89 billion.
Ashland closed Wednesday at $52.44, gaining $1.43, or 2.80 percent.
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