Morgan Stanley puts the brakes on Lorillard

|By:, SA News Editor

Lorillard (LO -1.9%) trades lower after Morgan Stanley downgrades the company to an Underweight rating.

The investment firm thinks the takeover premium on Lorillard has outrun itself to offer investors very little upside.

There's also some caution issued on the risk of the menthol-heavy Newport brand.

What to watch: Look for a defense from Wells Fargo analyst Bonnie Herzog who is far out on the Lorillard limb.