Lehman Brothers downgrades Aventine, VeraSun: corn prices unlikely to decline in the near-term

Lehman Brothers analyst Mansi Singhal downgraded VeraSun Energy (VSE) and Aventine Renewable Energy (AVR) to “Equal”, from “Overweight”, saying that corn prices were unlikely to decline in the near term.

She downgraded the ethanol sector to “Neutral” from “Positive”, and established a $13 target price for both Aventine and VeraSun.

The news continues a bad steeak of downgrades for the sector. Last month, Broadpoint Capital initiated coverage of Pacific Ethanol (PEIX) yesterday with a “Sell” rating on the stock.

In September, FBR analyst Eitan Bernstein downgraded Aventine (AVR), VeraSun (VES) and Pacific Ethanol (PEIX) as the analyst proved pessimistic on the chances for a price recovery for ethanol or relief for producers on the cost side.

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