UPDATE: Morgan Stanley Downgrades Perrigo; Raises PT

According to a research report released this morning, Morgan Stanley has downgraded Perrigo

from Overweight to Equal-weight, and raised PT from $110 to $125. In the report, Morgan Stanley said, "We are rolling forward our PT from 20x our calendar ‘12E of $5.51 to 20.5x cal. ‘13E of $6.10 (fiscal yr. ends in June). We believe superior execution and potential to add new growth drivers in adjacent CHC categories (e.g., wound care, animal health) continue to justify PRGO's premium multiple. Our $125 PT is supported by DCF (FCF of $3B in F12-16E, 8% WACC, 2.5% term. growth), and is up 6% vs. curr. share price of $118. Upside risks include future accretive M&A and/or add'l multiple expansion." Perrigo closed yesterday at $118.32.