Piper Jaffray Remains Neutral on Solera Holdings (SLH) as LBO Speculation Boosts Shares

Piper Jaffray maintains a Neutral rating and $43.00 price target on Solera Holdings (NYSE: SLH) as an LBO speculation boosts shares. Bloomberg reported that Solera has approached buyout firms to explore the possibility of an LBO. Analyst Peter Appert says that he likes Solera's business model and secular growth outlook, but with near-term earnings constrained by acquisition dilution, thinks the shares are fairly valued from a fundamental standpoint.

Appert commented, "Bloomberg reports that Solera has approached buyout firms to explore the possibility of an LBO. While this may explain the recent strength in the shares (up 21% in the last two weeks vs. a -1% move in the S&P500) on much higher than average volume, it is unclear to us if there is sufficient valuation upside to justify an LBO transaction. Our preliminary calculations suggest that an LBO value higher than the mid $40 range may be difficult to achieve."

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

Shares of Solera Holdings closed at $48.65 yesterday.

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