Mizuho Starts Boyd Group Services (BGSI) at Outperform, PT $120

Mizuho analyst David Bellinger initiates coverage on Boyd Group Services (NYSE: BGSI) with a Outperform rating and a price target of $120.00.

The analyst comments "We launch coverage of Boyd Group Services (BGSI) with an Outperform rating and $120 PT - adding a new layer to our automotive coverage. BGSI operates as one of the largest non-franchised players in the ~$50B collision and glass repair market with >1,300 North American locations. The business has underperformed its stated +3-5% same store sales algorithm over the past 10 quarters, given cyclical dynamics including: 1) Unprecedented auto insurance premium growth; 2) Used vehicle pricing volatility; 3) Elevated total loss rates. We see these pressures beginning to fade as evidenced with better Q2 results and as cost takeouts lower the business' natural leverage point. We're also attracted to the >90% of Boyd's revenue base generated by insurance carriers, even as new technologies limit accident frequency. Shares are too cheap to ignore at current levels with a FCF yield >10%. A new buyback program provides upside."

For an analyst ratings summary and ratings history on Boyd Group Services click here. For more ratings news on Boyd Group Services click here.

Shares of Boyd Group Services closed at $81.00 yesterday.

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