UPDATE: Morgan Stanley Downgrades Blue Nile to Equal-Weight on Tempered Growth Outlook

Morgan Stanley downgraded Blue Nile NILE from Overweight to Equal-weight and removed the price target of $48.00. Morgan Stanley commented, "Changing our rating to Equal-weight, relative to our coverage universe: We still like the company, but we believe the stock will perform more inline with its peers until it can show sustained acceleration of non-engagement sales. We are concerned that the ultimate cost of driving non-engagement sales may be higher than we expected. … We are reducing our base case fair value to $36, which is driven by a DCF valuation analysis assuming a 14% WACC and 4% perpetual growth rate." Blue Nile closed at $30.30 on Wednesday.