UPDATE: Morgan Stanley Upgrades Education Management

According to a research report published earlier today, Morgan Stanley has upgraded Education Management Corp.

from Underweight to Equal-weight. Morgan Stanley said in the report, “EDMC is still trading at a ~30% premium to peers on C12e EV/EBITDA, but the premium has come in from the ~60% at YE11, as the Street's outlook has turned more negative. EDMC still faces numerous headwinds, which could drive valuation down further, but the risk-reward is now far more balanced. With the stock trading at a more fundamentally reasonable level we upgrade shares to Equal-weight, given the risk that the limited float can still cause erratic trading (though we believe buybacks are now less of an option for the company).” Morgan Stanley maintains its $15 PT on Education Management, which closed yesterday at $16.29.