UPDATE: Brean Capital Reiterates Buy Rating, Lowers PT on Rentrak Corporation on Slower Growth Prospects

In a report published Friday, Brean Capital analyst Todd Mitchell reiterated a Buy rating on Rentrak Corporation RENT, but lowered the price target from $95.00 to $86.00. In the report, Brean Capital noted, "Last night, Rentrak reported disappointing F3Q15 results, guided down F4Q15, and made cautionary comments about F2016 that imply growth of TV Everywhere will be below its previous outlook of 80%. We look stupid, having just raised our target price in a note (2/2/14) hypothesizing that growth would actually accelerate beyond these levels. We stand by our assertion that the underlying conditions for an acceleration in growth are now in place, but we concede we erred in our interpretation of how management would respond. We thought they would go for market share, and instead it appears they are going for price. Given the degree to which Rentrak is undercutting its chief competitor's pricing model, this is probably a smart long-term strategy. However, it is likely to cause some near-term headwinds, slowing the rate of new customer additions, and by extension top-line growth. Couple this with downward pressure on gross margins from bringing new data suppliers on line, and a step up in operating expense due to the Kantar acquisition, estimates and price targets are coming down and shares are likely to underperform in the near term. Nevertheless, we still remain believers in Rentrak's long-term prospects. As a result, we are lowering our target price on RENT to $86 from $95, but maintain our Buy rating." Rentrak Corporation closed on Thursday at $80.52.