UPDATE: Bank Of America Upgrades Angie's List; Shares Jump In The #PreMarket
In a note released early Friday morning, Bank of America analyst Paul Bieber upgraded Angie's List (NASDAQ: ANGI) from Neutral to Buy and maintained his $16 price objective.
Following the upgrade, shares of Angie's List have jumped up about eight percent in Friday's pre-market session.
Bieber explained the upgrade came after positive commentary from the company's CEO Bill Oesterie at the Bank of America tech conference. He continued by citing a stabilizing ARPU, constructive penetration trends and an improving sales force as reason for optimism.
In terms of ARPU, Bieber noted the the company is seeing a better-than-expected reaction to its newly-rolled out tiered pricing model. He believes this could bring about "improved stock sentiment" and less controversy around Angie's pricing model.
Looking at market penetration and the sales force, Bieber noted that the company is still posting growth rates of 20+ percent in some Midwestern cities and has resumed scaling its sales force following last year's disruption.
Looking at the valuation, Bieber pointed to lower street estimates and the stock being down 33 percent year-to-date, as well as an estimated 60 percent upside to his price target as reasons to think the stock is currently at an attractive price.
Shares of Angie's List closed at $10.10 on Thursday.
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