UPDATE: J.P. Morgan Downgrades Broadridge Financial Solutions to Underweight, Raises PT on Mixed Factors

In a report published Wednesday, J.P. Morgan analyst Tien-tsin Huang downgraded the rating on

from Neutral to Underweight, but raised the price target from $31.00 to $32.00. In the report, J.P. Morgan noted, “We are downgrading BR to Underweight from Neutral as shares are trading at a rich PEG despite limited signs of core EPS acceleration. We think end market discretionary spending remains challenged, creating less opportunity for upside in earnings. Moreover, we think there's modest risk that deal ramps could slow. Our 2013-2015 EPS CAGR of 8% is a discount to other low organic growth processors (e.g., FISV, FLT) with more earnings volatility due to event driven revenues and trading volume, arguing for a greater discount. Attractive dividend yield of 2.8% limits downside, but we see limited multiple expansion, supporting our Underweight rating. Key risks to our rating would be mean reversion in certain fee streams that are near cyclical lows, notably event driven revenues.” Broadridge Financial Solutions closed on Tuesday at $31.75.