UPDATE: J.P. Morgan Downgrades AVG Technologies NV to Overweight, Lowers PT Following Tough Q, Worse Guide

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In a report published Friday, J.P. Morgan analyst John DiFucci downgraded the rating on
AVG Technologies NVAVG
from Neutral to Overweight, and lowered the price target from $28.00 to $20.00. In the report, J.P. Morgan noted, “AVG reported disappointing 3Q results, but its 4Q guidance and a peek into 2014 were even worse as it exits a meaningfully sized business because of material and abrupt degradation of its fundamentals. We expect heavy pressure on the shares today, but if it settles in the $15 range, investors looking for fallen angels might want to step in because we believe the existing subscription base alone is worth that. We're reducing our rating to Neutral from Overweight and reducing our price target to $20 from $28. We don't typically change our ratings on results because our fundamental thesis is still usually intact. However, in this case, we believe investors will logically assign very little value to the Platform business since these results demonstrate that AVG has little control over its own domain in this realm, and it's unlikely that the mobile opportunity will ever offset this, in our opinion.” AVG Technologies NV closed on Thursday at $19.70.
Posted In: Analyst ColorDowngradesAnalyst RatingsJ.P. MorganJohn DiFucci
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