UPDATE: J.P. Morgan Downgrades Virtusa Corporation to Neutral on Full Valuation

In a report published Monday, J.P. Morgan analyst Puneet Jain downgraded the rating on Virtusa Corporation VRTU from Overweight to Neutral, but raised the price target from $22.00 to $25.00. In the report, Jain noted, “We are downgrading VRTU from Overweight to Neutral as we think the 46% stock rally this year (vs. S&P 500 up 9%) already prices in much of the earnings growth upside we expect in FY14 (initial guidance to be issued in early May). Moreover, unlike in the previous years, the company's large clients may not be a significant driver of its overall growth next year, potentially triggering growth slowdown in FY14. However, VRTU's growing pipeline and margin expansion potential should still result in solid earnings growth this year (we est. 30%), keeping us at Neutral.” Virtusa Corporation closed on Friday at $23.97.