UPDATE: Morgan Stanley Initiates Coverage on ADT Corp with Equal-Weight Rating, $40 PT

In a report published Monday, Morgan Stanley initiated coverage on ADT Corp

with an Equal-Weight rating and $40.00 price target. Morgan Stanley noted, “We view ADT's position favorably over the medium term, given clear scope for rising household penetration driven by the bundling of remote wireless control and home automation solutions to the basic alarm product. These interactive services are also driving up ARPU and could lower churn - the dream combination. However, over the long term, our AlphaWise survey of over 1,000 households suggests there is potential for cable and telecom entrants to take market share and put increasing pressure on pricing.” ADT Corp closed on Friday at $36.48.