UPDATE: Deutsche Bank Downgrades Advance Auto Parts on Multiple Negative Factors
In a report published Friday, Deutsche Bank analyst Mike Baker downgraded the rating on Advance Auto Parts (NYSE: AAP) from Buy to Hold, but raised the price target from $92.00 to $106.00.
In the report, Deutsche Bank noted, “While we believe AAP's recently announced acquisition of General Parts will be transformative for the company, we think that, as well as internal cost cutting initiatives, are now reflected in AAP's valuation. Conversely, when we went from Hold to Buy over the summer, we thought the low valuation at that time reflected sales weakness and any positive news would be a catalyst, so the risk / reward was positive. But, after recent outperformance, this is no longer the case and we are moving to Hold from Buy even as we increase our price target to $106 from $92. The three reasons beyond our downgrade include a reduced risk / reward profile, integration risk from the deal, and weak industry trends.”
Advance Auto Parts closed on Thursday at $99.18.
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|Nov 2016||Raymond James||Upgrades||Outperform||Strong Buy|
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