Morgan Stanley Believes Risk/Reward Is Still Not Compelling For Container Store Group Inc

In a report published Tuesday, Morgan Stanley analyst Simeon Gutman reiterated an Equal-Weight rating and $20.50 price target on

. In the report, Morgan Stanley noted, “TCS' risk/reward is still not compelling, in our view, even with another big move down in the stock (quoted 12-13% lower in the after-market). EPS guidance has now been reset for two consecutive quarters. The story hinges on Q4, but disappointing results and poor traffic in the interim argue for a lower multiple. Given the stock's relatively high valuation (32x previous 2015e consensus EPS), there could be ample room for downside. Our new price target of $20.50 assumes 32x our 2015e EPS of $0.63 and implies a PEG ratio of 1.3x,consistent with other high-growth retailers.” Container Store Group Inc closed on Monday at $21.89.