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UPDATE: Stifel Nicolaus Downgrades Bright Horizon Family Solutions to Hold, Valuation Fair

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In a report published Thursday, Stifel Nicolaus analyst Robert L. Craig downgraded Bright Horizon Family Solutions (NYSE: BFAM) from Buy to Hold and removed its $34.00 price target.

In the report, Craig wrote, "The shares are now selling at just over 24x our 2014 adjusted EPS estimate of $1.43, nearly 28x forward-12 estimated EPS of $1.25 and an EV/EBITDA multiple of 12.7x on 2014 estimates. By comparison, the peer group multiples average 20x and 9.2x on 2014 consensus and BFAM's historical valuations were 24x forward-12 and 11x EV/EBITDA, respectively. Current valuation is fair, in our opinion, given expected EPS growth approximating 20+% per year. All else being equal, we would look to return to a more aggressive stance in the high 20s. The stock is up over 20% since our coverage initiation at $28.35 (vs. the S&P 500 up 1%) and up nearly 60% since the IPO pricing at $22 (above the filing range of $19-$21) mid January vs. the S&P 500 up 4%."

Shares of Bright Horizon Family Solutions closed at $34.76 on Wednesday and are currently flat after this report.

Latest Ratings for BFAM

DateFirmActionFromTo
May 2015BarclaysMaintainsOverweight
Feb 2015JP MorganMaintainsNeutral
Dec 2014BarclaysMaintainsOverweight

View More Analyst Ratings for BFAM
View the Latest Analyst Ratings

Posted-In: Stifel NicolausAnalyst Color Downgrades Analyst Ratings

 

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