Brean Murray Initiates Coverage of Synutra International (SYUT) with a Hold

November 4, 2008 10:06 AM EST

Brean Murray initiates coverage of Synutra International (Nasdaq: SYUT) with a Hold rating.

Brean analyst says, "The company's share price has plunged ~80% in the wake of the melamine crisis, more severe than the other leading Chinese dairy companies implicated, and significantly more than the history of food scares would suggest. While the stock's correction started from a high valuation, and we expect severe near-term losses, we believe the damage has largely been reflected in the valuation. Potential near-term volatility is holding us back, but we would revisit SYUT if the stock trades persistently and substantially below $10 due to excessive market swings."

Synutra International, Inc. (Synutra), through its wholly owned subsidiary, Synutra Inc., is engaged in the production, marketing and sales of dairy-based nutritional products in China under the brand names Shengyuan, or Synutra, the Company’s brand, and several sub-brands, including Super, U-Smart and U-Strong.

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• Brean Murray Carret & Co.

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