Analyst Upgrades Masco, But Shares Slide

NEW YORK (AP) — An analyst upgraded shares of Masco Corp., the largest maker of kitchen and bath cabinetry, Friday on the company's cost cutting and product innovation, but the shares still retreated along with the broader market.

Daniel Oppenheim of Credit Suisse raised his rating on the stock to "neutral" from "underperform" and increased his target price $13 from $9.

He said Masco's paint business has been doing well lately, partly from the success of its Behr paint mixing kiosks in Home Depot where customers can create their own paints.

"We expect this strength to continue in coming quarters based on the likelihood that consumers will remain focused on low-cost home improvement projects," the analyst said.

The Taylor, Mich., company has cut the number of products it sells to builders of new residences, a segment that accounts for about 35 percent of Masco sales, leaving only its highest-margin items.

Finally, cost cutting and less expensive input costs are boosting profit margins, Oppenheim said.

In afternoon trading, the stock fell 7 cents to $13.70. The broad-based S&P 500 stock index was down nearly 1 percent to 1,087.09.