Analysts at the Buckingham Research Group consider Lear Corporation LEA to be "one of the best" auto supplier companies in the sector yet at the same time the stock can no longer be considered a buy. The firm's Joseph Amaturo downgrades Lear's stock rating from Buy to Neutral with an unchanged $175 price target as continued upside in the stock is unlikely.
For years investors were encouraged to "aggressively" buy Lear's stock and those who did so have been rewarded, Amaturo commented in his downgrade note. Yet at this point, the stock's valuation needs to be put in perspective although there is no reason to believe there are any negative near-term catalysts.
Bottom line, the downgrade is strictly due to valuation concerns alone and not a sign of poor earnings report for the third quarter or full fiscal year on the horizon.
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