UPDATE: Bank of America Merrill Lynch Upgrades Con-way to Buy

Bank of America Merrill Lynch is out with its report today on Con-way

, upgrading CNW from Neutral to Buy. In a note to clients, Bank of America Merrill Lynch writes, "We are upgrading Con-Way's shares to Buy from Neutral, and our price objective to $45 from $43. We are increasing our 2011 and 2012 EPS estimate 3% and 2% to $1.65 and $2.55, from $1.60 and 2.50, respectively. Our new $45 price objective is based on an 18x multiple (from 17x) on our revised 2012E EPS. We believe a multiple at the upper end of Con-way's 16-year historical range of 10x-18x is warranted given strengthening LTL fundamentals, coupled with a return to rational pricing, which augurs well for future profitability. We are also encouraged by the upbeat outlook (best in years) provided by Con-way CEO Doug Stotlar during our Transportation Conference in Boston last week and believe it denotes further evidence that the LTL supply-demand equilibrium is being restored." Shares of CNW closed Tuesday at $37.41, down 0.98% from Monday's close.