UPDATE: J.P. Morgan Lowering Price Target on HealthSouth

J.P. Morgan Chase & Co. is out with a research report on HealthSouth Corp HLS and it is lowering its price target to $25 from $28, but is keeping its Neutral rating on shares. In a note to clients, J.P. Morgan Chase & Co. writes, "HealthSouth reported 3Q11 EPS of $0.17/share compared to our estimate of $0.21 through adjusted EBITDA came in $7.5mm (7.3%) above our outlook at $110.5mm. Against our outlook the better performance was due to lower other operating expense, supplies and bad debt. HLS raised its EBITDA outlook to $450-$455mm, from the prior range of $447-$453mm. Additionally, the company announced a $125mm buyback, representing about 6% of the diluted share count. We are adjusting estimates and maintaining our Neutral rating with an updated Dec-2012 price target of $25." Shares of HLS closed at $18.43 yesterday.