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The Markets
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Morgan Stanley price target cut hits where it Hertz

Stocks covered: Hertz Global Holdings, Prairie Provident, Sun Life

Shares of car rental firm Hertz Global Holdings Inc (NYSE:HTZ) took a bashing earlier this week after terrible results, and now Morgan Stanley has put the boot in.

The heavyweight investment bank has cut its price target from US$15 to US$12 in the wake of Monday’s “disappointing” update.

The shares have lost a third of their value over the last five days and now trade at US$11.12, down another 10.9% today.

Mackie Research has reiterated its ‘buy’ recommendation and C$2 target price for Alberta-focused Prairie Provident Resources Inc (TSE:PPR).

READ Profits more than double at Prairie Provident

The broker says the oil and gas producer remains undervalued on a cash flow, reserves and net asset valuation basis.

“We expect the market discount to diminish as the company continues to grow production which is targeted to increase to ~7,500 boe/d [barrels of oil equivalent per day] by year-end through exploitation of its large inventory of development Mannville location at its Wheatland and Princes core area,” Mackie’s Bill Newman predicted.

It’s got a way to go - the shares currently trade at around C$0.62.

According to Newman’s calculations, that’s a valuation that represents just 39% or so of its proven developed producing reserves valuation of C$1.56 a share and 23% of its proved + probable, or 2P, reserves value of C$2.61 a share.

Eight Capital has maintained its neutral rating on Sun Life Financial Inc (TSE:SLF, NYSE:SLF) following a second successive quarterly earnings miss.

The shortfall was largely down to the US and Asia divisions, the broker noted, but it added that it was equally concerned at the high level of net institutional outflows at MFS, its asset management arm.

Although the broker holds its rating, it has cut its price target to C$50 from C$52 on the back of lower return on equity and earnings per share estimates.

It continues to prefer Manulife Financial Corp (TSE:MFC) in this sector .

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