NEW YORK ( TheStreet) -- Cablevision Systems ( CVC) fell 1.7% today after Morgan Stanley downgraded the company to an equal weight rating from an overweight rating and upped its price target on the stock to $37 from $35.

Analyst Benjamin Swinburne with Morgan Stanley downgraded the stock on the belief that the its current valuation already reflects the company's strengths, including a "shareholder-friendly capital structure" and broadband pricing power.

Swinburne also lowered his 2011 earnings estimate to $2.11 per share from his previously expected $2.37 per share. He decreased his 2012 earnings outlook to $2.18 a share, down from $2.79 a share.

Swinburne raised his price target on the cable company's stock on the pending Rainbow spinoff.

Swinburne anticipates that Rainbow will command a strong multiple and an equity value of about $9 per Cablevision share for 2011.

The new, public Rainbow company will include national programming networks AMC, WE TV, IFC, Sundance Channel and Wedding Central. It will also include IFC branded films and Rainbow network communications. Cablevision will remain head of its cable and telecommunications business, Newsday, News 12 networks, MSG Varsity and Clearview Cinemas.

In a Nov. 18 research note, analyst James Ratcliffe of Barclays Capital estimated that spinning Rainbow off into a standalone entity could add somewhere between $1 and $3 per share in value to Cablevision's stock.

Cablevision shares fell 1.7% to close at $34.05 on Monday.

--Written by Theresa McCabe in Boston.

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