UPDATE: Sterne Agee Downgrades American Capital to Neutral

Sterne Agee lowers its rating on American Capital (NASDAQ: AGNC) to Neutral from Buy as its shares approach its now-discontinued $30 price target.

Sterne Agee says, "Upon approaching our stated price target of $30, we are downgrading the shares of AGNC from BUY to NEUTRAL. Our change in rating is less a function of any negative development, but is primarily based upon valuation. We maintain our view that this company has the most attractive portfolio strategy among the Agency REIT group, and expect it to be well-suited to limit negative pressure on ROEs going forward."

AGNC closed at $29.82 a share on Tuesday.