UPDATE: Morgan Stanley Downgrades Zipcar to Underweight on Top-Line Slowdown

Morgan Stanley reduced its rating on Zipcar ZIP from Overweight to Underweight and cut its price target on shares from $15 to $7. Morgan Stanley noted, "Top-line growth is slowing earlier and more severely than we expected. We cut our forecasts based on lower membership growth, reduced fee revenue and higher new member acquisition costs. Our revised $7 target assumes growth and EBITDA margins more like traditional rental companies." Zipcar closed at $10.63 on Thursday.