ADT Downgraded At Citi

Citi issued a report on ADT Corporation (NYSE: ADT) after recent analysis showed that the company's strong fundamentals may already be priced into the stock. Citi downgraded ADT from Buy to Neutral and raised its price target from $41 to $46.Analysts Jason Bazinet and Robert Koryl wrote, "Our prior $41 target price gives credit for future FCF that ADT could generate once Pulse is fully penetrated. And, with our higher price target, we now give credit for a potential DIY announcement. At current levels, therefore, we don't see material scope for further appreciation in the share price (absent a transitory lift from investors covering short positions)."ADT has reported solid year-over-year improvements in the value of acquired subsidiaries during the last two quarters driven by improving churn and good cost-to-serve margins. At ADT's Analyst Day, Citi believes that ADT could provide an articulation of the firm's long-term FCF potential and launch a DIY security offering. However, the analysts believe that neither of these will add significant value to the stock price. Shares of ADT last traded at $41.81.