UPDATE: Global Hunter Securities Downgrades Navistar International (NAV) to Neutral

(Updated - September 28, 2015 10:44 AM EDT)

Global Hunter Securities downgraded Navistar International (NYSE: NAV) from Accumulate to Neutral and lowered its price target to $16 from $26.

The analyst commented, "While NAV still appears poised to deliver 8% EBITDA margins or higher during FQ4:15 (management reiterated this to us as recently as 10 days ago), the question now appears to be the revenue base off which this margin can be achieved, especially in FY2016. Our initial thesis contemplated flat to slightly improving Class 8 market share, but since we launched coverage in late 2014 this has failed to materialize, with North American Class 8 share of production down nearly 300 bps YTD. We note the advent of several new issues in FY2015, such as challenges in the used-truck market and new litigation, and without the benefit of strong increases in volumes going forward (flat share at best in a flat-to-down truck market in 2016), we believe the risks are more closely aligned to the rewards at the current time. We do expect pockets of good news going forward, such as the aforementioned EBITDA margins as well as the potential for incremental growth in the medium-duty market; at the same time, with nearly 75% of shares in the hands of the top five holders, the stock may remain very volatile from here. Overall, this call has simply not worked, and we would prefer to remain on the sidelines, for now."

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

Shares of Navistar International closed at $13.49 yesterday.

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