Nomura Securities Downgrades ServiceMaster (SERV) to Reduce, Sees 14% Downside

September 19, 2016 7:44 AM EDT
Get Alerts SERV Hot Sheet
Price: $35.31 -0.68%

Rating Summary:
    8 Buy, 1 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 30 | Down: 50 | New: 20
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Nomura Securities downgraded ServiceMaster (NYSE: SERV) from Neutral to Reduce with a price target of $31.00 (from $36.00), suggesting 14% downside.

Analyst Dan Dolev commented, "At Terminix (pest control), we expect the growth gap to peers to linger - hurt by execution mishaps, debatable M&A strategy/headwinds, and customer/employee attrition. We think the solution is higher-touch service; however, that could hurt margins by 100-200bps. For AHS (home warranty), maintaining growth at elevated levels amid deteriorating customer reviews means marketing increases could be perpetual. AHS growing 5x faster than Terminix dilutes the multiple."

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

Shares of ServiceMaster closed at $36.16 yesterday.

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