UPDATE: Ascendiant Capital Markets Downgrades Travelzoo to Neutral on Near-Term Outlook

Ascendiant Capital Markets lowered its rating on Travelzoo TZOO from Buy to Neutral and reduced its price target from $27 to $21. Ascendiant Capital Markets noted, "We are increasingly concerned about Travelzoo's near term outlook. Revenue growth has slowed, and it now appears that the company will have to invest significantly in marketing and product development. An increasingly competitive daily deals business is likely to continue, and the company's entry into hotel bookings (OTA) is full of uncertainties as that market is already dominated by several much larger and entrenched competitors. … Lowering our rating to NEUTRAL from BUY, and our 12- month price target to $21 from $27, which reflects a forward P/E of 13x our new 2013 EPS estimate of $1.36 plus $3/share in cash." Travelzoo closed at $20.02 on Friday.