UPDATE: Bank of America Merrill Lynch Reiterates Buy Rating, Raises PT on Soufun Holdings Limited

In a report published Monday, Bank of America Merrill Lynch reiterated its Buy rating on Soufun Holdings Limited

, and raised its price target from $22.90 to $26.00. BofA Merrill Lynch noted, “Although the ad market in China is still under pressure due to its lagging nature to economic conditions, there are signs of improvement for certain niche media that serve particular industries. Backed by the rebound in property sales, real estate related advertising is likely to see recovery. We note that the number of new project launches, a good indicator of real estate advertising has returned to positive growth since 3Q12. We thus raise our 2012/13 sales forecasts by 2%/5% respectively. With some operating leverage being realized, our 2012/13 EPS estimates are raised by 1%/ 7% respectively. Our DCF-based PO is up to US$26, implying 12x 2013 P/E.” Soufun Holdings Limited closed on Friday at $23.39.