UPDATE: Deutsche Bank Reiterates Hold Rating, Lowers PT on Resources Connection
In a report published Friday, Deutsche Bank reiterated its Hold rating on Resources Connection (NASDAQ: RECN), but slightly lowered its price target from $12.00 to $11.00.
Deutsche Bank noted, “Lower price target due to lower EPS expectations. Nov. qtr revenue missed our expectations, while the outlook SG&A in the Feb quarter is higher than expected. Our F3QE EPS falls from $0.14 to $0.09 (previous Street $0.14) while our F4QE EPS goes from $0.24 to $0.23 (previous Street $0.21). Our FY13E EPS decreases from $0.68 to $0.58 (previous Street $0.63). We are lowering our price target from $12 to $11 due to our lower EPS expectations. At our PT, RECN would trade at a cal'13E P/FCF of 12x and PE of 17x, which we think is reasonable versus peers and considering the $2.75/share of cash (23% of share price) on the balance sheet. Hold.”
Resources Connection closed on Thursday at $12.40.
(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.