UPDATE: Diebold (DBD) Raised to 'Overweight' at JPMorgan on Valuation; Pull-Back Tied to 'Forced Selling', Says Analsyt
- Record-setting rally pushes on as S&P ends week up 3 percent
- Trump's Cohn Pick Most Bullish Sign Yet for Banks - Cowen
- Unusual 11 Mid-Day Movers: (IDXG) (INVN) (EBS) Higher; (SCON) (DTEA) (DLTH) Lower (more...)
- 21st Century Fox (FOXA) offers to acquire Sky for GBP10.75/share
- Coca Cola (KO) Announces James Quincey to Succeed Muhtar Kent as CEO; Kent to Continue as Chairman
Get instant alerts when news breaks on your stocks. Claim your 2-week free trial to StreetInsider Premium here.
(Updated - September 26, 2016 9:56 AM EDT)
JPMorgan upgraded Diebold (NYSE: DBD) from Neutral to Overweight with a price target of $33, implying upside of 34%. Analyst Paul Coster sees compelling valuation, and he said a pullback in shares could be related to "forced selling."
"A 13% decline in DBD stock over the last month (S&P500 down 1%) may have been triggered by the pending cut to the dividend and sale of US-listed DBD shares by European investors, yielding an opportunity to buy this stock at an attractive multiple that offsets the near-term tail-risks associated with acquisition of Wincor Nixdorf. By the February 2017 analyst day, noise associated with the acquisition should dissipate and investors should gain a clearer line of sight to the $160 million synergy target, debt deleveraging potential, and earnings power. Inbound call activity has been elevated, suggesting to us that long-inclined investors are looking for an entry-point here," said Coster.
Commenting further on the recent pull-back in shares, the analyst said, "DBD, down ~13% in the last month, has under-performed the market (down 1%) and near-peer NCR (down ~6%), spurring inbound queries from clients. We believe much of the underperformance can be attributed to forced-selling by some dividend investors (ahead of the signaled 2/3rds reduction to the dividend) and by European investors that received US-listed DBD shares on August 16th. To the extent we are correct, and that forced selling abates, we believe the stock is poised to recover."
Shares of Diebold closed at $24.49 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- MKM Partners Raises Price Target on Finisar (FNSR) to $43 Following 2Q
- BMO Capital Cuts Price Target on Cooper Cos. (COO) Following 4Q Results
- Instinet Reiterates Buy on Oracle (ORCL) Ahead of 2Q Earnings
Create E-mail Alert Related CategoriesAnalyst Comments, Hot Comments, Hot Upgrades, Upgrades
Related EntitiesJPMorgan, Standard & Poor's, Earnings, Definitive Agreement
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!