UPDATE: Credit Suisse Downgrades GNC Following Q4 Earnings Season
In a report published Monday, Credit Suisse analyst Gary Balter downgraded the rating on GNC (NYSE: GNC) from Outperform to Neutral, and lowered the price target from $65.00 to $51.00.
In the report, Credit Suisse noted, “While we are stepping to the sidelines near term, we continue to like the longer term GNC tory. Over his tenure at the company, Chairman, President & CEO Joe Fortunato has positioned GNC to benefit from strong growth in sports nutrition and franchising both domestically and abroad. That led to earnings more than doubling over a few years. And this model remains compelling as GNC has strong customer loyalty (8.3 million active Gold Card members), sees benefits from new franchisees through both franchise and manufacturing income, and is beginning to mine its customer data to improve its CRM.
"We believe that this recipe could return GNC to high-teens or better growth in 2015, but we believe that near-term results may be more in-line, leaving limited upside in the name.”
GNC closed on Friday at $46.55.
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