UPDATE: Bank Of America Moves PetSmart To No Rating As Sale Or Merger Is Possible

In a report published Tuesday, Bank of America analyst Denise Chai moved the rating on

from Underperform to No Rating, and removed the $48.00 price target. In the report, Bank of America noted, “Jana Partners, disclosed on 7/3 a 9.9% stake in PETM, from a prior position of 5.1% of shares outstanding. Jana is now PETM's largest shareholder, followed by Longview (9.0%), Vanguard (7.6%) and JP Morgan (5.1%). "In a letter disclosed in Jana's 13D filing, Jana stated that it believes PETM is undervalued and intends to engage in discussions with the company's board of directors concerning a review of strategic alternatives including: 1) exploring a sale of the company; 2) improving operating performance; 3) PETM's capital structure including providing for a significant return of capital to shareholders; 4) improving capital allocation; 5) improving disclosure to shareholders; and 5) management & board compensation.” PetSmart closed on Monday at $68.95.