UPDATE: Bank of America Downgrades RadioShack to Neutral; Strategic Direction Pending
Bank of America downgraded RadioShack (NYSE: RSH) from Buy to Neutral and raised the price objective from $3.50 to $4.00.
Bank of America analyst Denise Chai noted, "We are downgrading RSH from Buy to Neutral as many of the positive catalysts that we had been predicating our Buy rating on are largely priced into the stock, in our opinion. Namely, RSH is exiting its loss-making partnership with Target and a new CEO has been named, which we think is important given the need for a change in its strategic direction. We are increasing our PO to $4.00 (based on 0.1x 2013E price/sales, from $3.50 on 0.08x prior) to reflect these positive changes, though we believe upside will be more limited until a clear strategic plan is presented, likely not until 2H13 at the earliest. As such, a Neutral is warranted in our view."
RadioShack closed at $3.69 on Monday.
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