UPDATE: Benchmark Company Downgrades Big Lots to Hold, Lowers PT

In a report published Friday, Benchmark Company downgraded its rating on Big Lots

from Buy to Hold, and lowered its price target from $45.00 to $33.00. Benchmark noted, “Big Lots Q2 EPS was a nickel below expectations, but the Company lowered guidance by $0.45 as its customer becomes strapped. Given that the Company products are 70% discretionary, we believe the consumer environment could negatively impact Q4 and beyond. We are downgrading our rating to Hold, from Buy, given the stress that the consumer is experiencing. We lowered our price target to $33, from $45, on lower estimates and a more conservative multiple. Until we get more confident, we reduced our price target multiple to 5.5 times our 2012 EBITDA or 11.5x our 2012 EPS estimate. While we believe that this management team has the talent and experience to fix merchandise problems, the problem seems more macro and beyond their control.” Big Lots closed on Thursday at $30.76.