UPDATE: Jefferies Downgrades HealthSouth Corporation to Hold on Regulatory Headwinds

Jefferies lowered its HealthSouth Corporation

rating from Buy to Hold and reduced its price target from $25 to $23. Jefferies noted, "HLS's strong Q2 performance and raised guidance was impressive, but we recommend taking advantage of stock strength to lighten long positions, fearing that IRF reimbursement could get greater scrutiny later this year when legislators look for funding offsets to another doc fix and deficit reduction." HealthSouth Corporation closed at $22.93 on Thursday.