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UPDATE: Citigroup Reiterates on Blackhawk Network Following Perfect Storm of Negative Factors

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In a report published Friday, Citigroup analyst Ashwin Shirvaikar reiterated a Buy rating on Blackhawk Network (NASDAQ: HAWK), but lowered the price target from $33.00 to $26.00.

In the report, Citigroup noted, “A perfect storm – a 4Q13 miss; tepid 2014 bottom-line guidance; Safeway's spin of its entire ownership stake – led HAWK stock down ~20%. At current levels, there is interest for HAWK stock but the timing of the announced spin (mid-March) implies the stock likely continues to be at this depressed level for a month. The seasonality of the business doesn't help matters, since there is no real catalyst in the next couple of quarters from a numbers standpoint. Having said this, adjusted operating revenue growth of 24%-28% and adjusted EBITDA growth of 20%-24% is strong and comments on a 2014 load value growth are positive. We are lowering our estimates and price target to $26 from $33 but HAWK remains a Buy at these lower levels.”

Blackhawk Network closed on Thursday at $22.41.

Posted-In: Ashwin Shirvaikar CitigroupAnalyst Color Price Target Analyst Ratings


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