PDATE: Bank of America Downgrades E-House to Underperform; Relative valuation unattractive

Bank of America downgraded its rating on E-House EJ from Buy to Underperform and lowered its price objective from $7 to $4.30. Bank of America noted, "[I]n view of the heightened policy risks (e.g. with the State Council asking local governments to cancel fine tuning policies lately), the risk reward profile of the stock does not look too attractive in our view. We downgrade the stock to UPF, with a new PO of US$4.3/shr, which is based on 10x FY13E Non-GAAP P/E. (was 14x FY12E P/E)." E-House closed at $5.23 on Monday.