UPDATE: Morgan Stanley Initiates Coverage on Covanta Holding

According to a research report published this morning, Morgan Stanley has initiated Covanta Holding

with an Equal-weight rating and $17 PT. In the report, Morgan Stanley said, "Covanta owns and operates 46 Energy from Waste (EfW) facilities that process municipal solid waste into electricity and steam. It has a solid US business and reasonable growth opportunities in Europe 3-5 years from today. Covanta's large capital return program demonstrates its solid balance sheet, but it also highlights limited capital deployment opportunities. CVA looks fairly priced today. Our $17 fair value is equal to 8.1x 2012e EV/EBITDA and suggests just 5% upside over the next 12 months." Covanta Holding closed Friday at $16.24.