BofA/Merrill Lynch Downgrades ITT Educational Services (ESI) to Underperform

BofA/Merrill Lynch downgraded ITT Educational Services (NYSE: ESI) from Neutral to Underperform with a price target of $7.00 (from $19.00) following CEO Kevin Modany's resignation amid news the company's sale leaseback transaction will not take place and that ITT had not filed its restated financials with the Dep't of Education.

Analyst Sara Gubins notes the downgrade comes as the list of uncertainties continues to grow. " If our estimates prove correct, shares are attractive given the recent move down, trading at 3.2x 2015E EPS. However, ESI faces the search for a new CEO, financial restatements, weak fundamentals, and numerous regulatory concerns which could further weaken financials."

For an analyst ratings summary and ratings history on ITT Educational Services click here. For more ratings news on ITT Educational Services click here.

Shares of ITT Educational Services closed at $7.72 yesterday.

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