UPDATE: Deutsche Bank Initiates Coverage on Smart & Final Stores with Buy Rating, $17 PT on Differentiated, Value-Oriented Disruptor

In a report published Monday, Deutsche Bank analyst Karen Short initiated coverage on

with a Buy rating and $17.00 price target. In the report, Deutsche Bank noted, “SFS is well-positioned to be a disruptor in food retail and foodservice distribution. At the S&F banner, the company will continue gaining share through aggressive pricing, a high-quality offering, and convenient locations - leading to consistent 4+% comp growth. Given S&F's significant unit potential, the company should be able to grow units by 10%/yr for 7 yrs in existing and adjacent markets. In the future, C&C also represents a significant growth opportunity. However, our estimates/valuation reflect only very modest expansion in this format for now. Net, the SFS growth algorithm should generate ~13% EBITDA growth and ~17% EPS growth through FY19.” Smart & Final Stores closed on Friday at $14.75.