UPDATE: Morgan Stanley Reiterates On PHH Following Fleet Sale Announcement

In a report published Tuesday, Morgan Stanley analyst Cheryl M. Pate reiterated an Equal-Weight rating on

, but removed the $23.00 price target. In the report, Morgan Stanley noted, “The announced sale of the fleet management business adds in excess of $4/share at the mid-point of the company's expected after-tax gain range of $250M - $300M (to $33.06 on proforma stated book basis, or $28.31 on a fully diluted basis) and increases PHH's excess cash position to north of $1B, by our estimates. Net proceeds are expected to be used to return capital, reduce debt levels and support the growth of the remaining mortgage business, which could add additional upside to valuation.” PHH closed on Monday at $25.25.