With September being an extraordinary month for the solar sector, a number of downgrades by analysts have come. Solera Holdings (NYSE:SLH) is the latest to experience that, as they and the overall industry are considered to have their value already priced into the share price of the stock.
Solera was downgraded from "Strong Buy" to "Buy" from Needham & Company.
Needham said, "We are downgrading SLH shares to Buy based purely on valuation. Our outlook with regard to Solera’s business fundamentals and our estimates are unchanged. We believe that a Buy rating is appropriate as there is upside to SLH shares as well as an upward bias to our estimates.
"Solera’s management team has a history of providing investors with a conservative set of financial expectations. Taking this into consideration along with our knowledge of the inherent operating margin leverage associated with information services business models such as Solera, we believe that there is upside potential to our FY’11 Adjusted EBITDA margin and Adjusted EPS estimates of 42.5% and $2.22."
Solera closed Friday at $43.73, losing $0.43, or 0.97 percent. Needhan has a price target of $50 on Solera.
1 comment:
Solera Holdings provides information and services to automobile insurers, bodyshops, and recyclers. They have no presence in the solar market segments.
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