DA Davidson Upgrades Stantec Inc. (STN) to Buy; Earnings Improve as Growth/Recovery Accelerates - Shares Expected to Follow

DA Davidson upgraded Stantec Inc. (NYSE: STN) from Neutral to Buy. Price target raised to C$36 from C$32.

DA analyst says, "Stantec reported earnings for the first quarter of 2011 of C$0.52 per share, above our estimate of C$0.41 (although near consensus). Operating performance benefited from improved net revenue growth, up 13% including nearly 3% organic growth. Margin also improved, including comparisons to an unusually high tax rate last year...Based on the prospects for improved growth near-term and long-term potential of 15% annually, we look for the shares to trade in line with historical and comparable company valuation multiples." (DA raises FY11 EPS estimate from $2.00 to $2.21 and FY12 from $2.30 to $2.50)

For more ratings news on Stantec Inc. click here and for the rating history of Stantec Inc. click here.

Shares of Stantec Inc. closed at $30.45 yesterday.

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