UPDATE: Stifel Nicolaus Downgrades Parkway Properties to Hold on Valuation

Stifel Nicolaus reduced its rating on Parkway Properties PKY from Buy to Hold and suspended its price target of $11.50. Stifel Nicolaus commented, "We are downgrading Parkway to Hold based on valuation as 1) since the announced $200mm equity infusion at $11.25/sh, PKY is up 18.2% vs the RMS up 1.31%, 2) the implied NOI cap rate of 7.9% is only slightly higher than Duke Realty (DRE, Buy, $14.36) and Liberty (LRY, Buy, $36.34) at 7.3% and 7.4% respectively, 3) Cash Flow and CF less G&A cap rates are 6.2% and 3.9% which reflects very high 171 bps capex and 230 bps G&A costs. These are all 3Q12 stabilized portfolio estimates." Parkway Properties closed at $11.68 on Thursday.