Merrill cut its fiscal 2008 earnings outlook on Lehman by 22% to $6.80 a share, Bear Stears by 16% to $12.07 a share (after early Aug. cut of 18%). But the Merrill also noted distinctions between Lehman and Bear Stearns. "Lehman is far more globally diversified, has had a much more dynamic equities business over the past few years, and is less dependent on the troubled US mortgage sector than BSC. It also does not face the reputational issues BSC has resulting from the BSAM hedge fund problem," said the report.