Benzinga's Top Upgrades with Color for May 17, 2012
Listed below are today's Top Upgrades at Benzinga:
KeyBanc Capital Markets says, "We have become more favorable toward GKSR primarily due to our view that the Company has a significant cost takeout catalyst that could alone produce operating margin expansion of at least 200-250 bps over the next two to three years. Moreover, in the current macro environment that is demonstrating non-linear improvement in job creation (the primary driver for the uniform rental names) we prefer GKSR's shares due to our view that imminent efficiency gains should drive earnings growth, regardless of the pace of recovery in employment."
Brean Murray Carret comments, "We upgrade CTRP shares from Sell to Hold, as the stock has reached our previous target price with the recent sell‐off. On the fundamental side, we have become incrementally more positive, as 1Q results + 2Q guidance seem to indicate that CTRP is stabilizing at a new revenue growth run rate of 15%‐20% with ~30% non GAAP operating margin, the base scenario the market has been looking for, in our view. With management reiterating its stable margin outlook in 2012 (vs. two consecutive cuts from the two previous quarters), we expect improving sentiment from the market and investor comfort of reinvesting in the stock."
Morgan Stanley notes, "We believe that recent weakness in Millennial Media's share price presents an attractive opportunity to own the largest independent mobile advertising business. We introduce a $17 price target, offering investors around 50% upside over the next 12 months."
Deutsche Bank comments, "Our stance upon initiation of coverage (Jan 2012) was simple: growth will be good but the shares may pull back and offer a better entry point. With the recent equity offering, the balance sheet and capacity to accretively acquire put it in a place where the next meaningful N-T move in the shares is likely to be up and not down, in our view. Given the growth outlook and improved capital structure, we believe a higher multiple is warranted (we go from 8.5x to 9.5x 2013E EV/EBITDA or 20x P/E) bringing our PT to $19 from $15."
Piper Jaffray said that it is upgrading shares of CTRN from Underweight to Neutral following better than expected FQ1 results. “We are raising our price target from $9 to $14 based on 12x FY14 EPS of $0.69 plus $6/share in cash and investments.”
Sterne Agee writes, "We are upgrading our rating on DELL to Neutral from Underperform and suspending our price target. Shares have grossly underperformed, hitting our previous $15 price target, declining 17% since our downgrade in mid-February vs. a 2% decline in both the S&P 500 and NASDAQ in the same time period. [O]ur concern was that investor sentiment on DELL shares had gotten too positive and arguably complacent for a company where consensus is modeling essentially no revenue or EPS growth. With the sizable pullback in shares, we believe expectations have been reasonably reset."
Deutsche Bank said that CHKM held its annual Analyst Day yesterday and began with an extensive discussion of CHK as its parent and General Partner. “In our view, the summary is that the CHK capital, balance sheet and other issues do not impact CHKM in terms of current operations or value creation.”
Citigroup said that the announcement comes following mixed C1Q post call update. “Cognizant of the strong outperformance on 5/16 (up 7.5% vs. median 50 bps decline for Traditionals), we nonetheless see further follow through as investors digest the implications and accretion related to the news.”
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