Stifel Downgrades Ryder Systems (R) to Hold on Valuation

November 15, 2016 6:44 AM EST
Get Alerts R Hot Sheet
Price: $76.45 +2.16%

Rating Summary:
    14 Buy, 6 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 18 | Down: 17 | New: 10
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Stifel downgraded Ryder Systems (NYSE: R) from Buy to Hold with a price target of $75.00 and removed the stock from the Select List. The firm cited valuation.

Analyst David Ross commented, "After a nice run this past week, Ryder is now trading 6% over our previously published 12-month target price (on what could be viewed as a conservative 11.5x target multiple, but we'd have to raise it to 13.5x to maintain our Buy rating, and we're not willing to do that at this point), so we are moving to the sidelines with a Hold rating. Ryder has been one of our favorite fundamental plays over the last year, providing one of very few secular stories in an otherwise volatile and cyclical transportation market. And though we still like the company's outsourcing growth story over the next several years, driven by increasing maintenance complexity and driver recruiting/retention issues leading private fleets to Ryder's leasing and dedicated solutions, in the near-term, we do not believe that next year will see much in the way of additional growth (just some recovery of earnings lost in 2016 due to a weak Class 8 rental market and significant drop in used vehicle prices). So, while Ryder still has many good things going for it, we believe R is fairly valued."

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

Shares of Ryder Systems closed at $79.39 yesterday.

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