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UPDATE: ISI Group Upgrades Monro Muffler Brake to Buy on Growth Outlook

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ISI Group upgraded Monro Muffler Brake (NASDAQ: MNRO) from Neutral to Buy and raised the price target from $35.00 to $42.00.

ISI Group noted, "We are upgrading MNRO to Buy as 60 years of history suggest the end of a 2yr U.S. tire deferral cycle is near, while M&A accretion and Chinese tire tariff reductions prime the pump for 30%+ EPS growth in FY14. Comps and margins have eroded 5.5% and 300bps respectively YTD, crimping earnings and keeping MNRO in the penalty box. That said, we believe comp pressures are more cyclical (weather/ tire deferral) than secular (shrinking sweet spot of 4-12 yr old vehicles). With $0.15-$0.20 of EPS accretion attainable for 2014 (15% EPS growth), and a ~$0.15 EPS tailwind from tire/ oil sourcing savings, we see upside to $42 in our Base Case."

Monro Muffler Brake closed at $37.25 on Friday.

Latest Ratings for MNRO

DateFirmActionFromTo
May 2016JefferiesMaintainsBuy
Apr 2016Goldman SachsMaintainsNeutral
Mar 2016OppenheimerInitiates Coverage onOutperform

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Posted-In: ISI GroupAnalyst Color Upgrades Analyst Ratings

 

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