UPDATE: Stifel Nicolaus Cuts PT to $27 on MYR Group on Declining Backlog
Stifel Nicolaus maintained its Buy rating on MYR Group (NASDAQ: MYRG) but reduced its price target from $31 to $27.
Stifel Nicolaus said, “We continue to believe that MYRG will be awarded a number of projects over the next several months that will help to replenish the backlog: 1) as the company's delayed One Nevada project moves back into construction in early 2013, the project will enter the backlog. We estimate the size of the project at least $50 million. 2) We believe the company is well-positioned to win a part of the ITC V-plan project, and 3) We are tracking $2.5 billion of that we believe have been or will be awarded over the next few months. … We maintain our Buy rating but are reducing our target price to $27.00 from $31.00. Our target price is based on a combination of 6x 2013 EBITDA and 11x 2014E EPS of $2.20 plus 2013E net cash of $3.03 per share. We view our target multiples as conservative. Our target reflects 37.8% upside potential."
MYR Group closed at $19.59 on Thursday.
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