UPDATE: Jefferies Downgrades Diamond Foods to Hold

Jefferies & Company has published a research report on Diamond Foods (NASDAQ: DMND) and has downgraded the company from Buy to Hold based on the pending SEC Investigation.In the report, Jefferies writes, "We are downgrading DMND to Hold from Buy and are lowering our target price to $27 from $46. In our view, the announced SEC investigation creates too much of an overhang with uncertain timing and increases the risk that the Pringles deal will be terminated. The downgrade is not a reflection of our view on the outcome of the investigation but we are taking a neutral stance until we have more clarity in this matter."Jefferies has lowered the price target from $46 to $27 on Diamond Foods, which is currently trading down $2.49 from yesterday's $29.51 closing price.