Compass Point Starts Xoom Corporation (XOOM) at Sell

Compass Point initiates coverage on Xoom Corporation (NASDAQ: XOOM) with a Sell rating and a price target of $11.00.

Analyst Michael Tarkan comments, "While we favor Xoom’s operating model relative to the legacy money transfer agent model, increasing competition and ongoing concentration risk create uncertainty—and with shares trading at 42x our 2015 EPS estimate and 27x our 2016 estimate, versus peers at 10x-11x and 9x-10x, respectively, valuation appears rich. Simply put, meaningful growth should continue over the next several years, but the stock still looks expensive relative to the potential risks, even though shares are already down 46% year-to-date."

For an analyst ratings summary and ratings history on Xoom Corporation click here. For more ratings news on Xoom Corporation click here.

Shares of Xoom Corporation closed at $14.80 yesterday.

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