UPDATE: Deutsche Bank Upgrades Trulia to Buy on Closing Valuation Gap
In a report published Wednesday, Deutsche Bank analyst Lloyd Walmsley upgraded the rating on Trulia (NYSE: TRLA) from Hold to Buy, and raised the price target from $34.00 to $38.00.
In the report, Walmsley noted, “We upgrade Trulia shares to Buy, as we see the stock closing the valuation gap that has emerged with Zillow. TRLA shares are off 14% since 2/15, while Z is +23%, the peer group is +17% and the NASDAQ is +2%. We see the company better positioned strategically post its follow-on offering given (1) a bigger cash pile for possible M&A and (2) a more articulated strategy to deepen agent relationships over time. We increase our target to $38 on multiple expansion in the group. Trulia's current 21% discount to Zillow on 2014 EV/EBITDA (on consensus on both) is well below the 7% average discount (since Oct 18), which makes little sense to us given the improving strategic position.”
Trulia closed on Tuesday at $30.57.
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