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RESEARCHSUMMARY
January 25, 2019 Daily Spotlight
At a GlanceSymbol Rating Est. Price Target
Prior Current Prior Current
PRICE TARGET CHANGESAEP B B $83.00 $84.00AVT H H $42.00 $45.00
CPE B B $15.00 $12.00
CDEV B B $22.00 $19.00
XEC H H $92.00 $85.00
FANG B B $160.00 $145.00
INTC H H $50.00 $53.00
KMI B B $23.00 $20.00
LLEX B B $5.00 $4.00
LOB H H $17.00 $15.00
MTDR H H $26.00 $23.00
PE B B $35.00 $27.00
PXD B B $215.00 $200.00
REN H H $36.00 $35.00
REI B B $12.00 $10.00
ROSE B B $8.00 $6.00
UCBI H H $25.00 $29.00
VNOM B B $37.00 $36.00
WPX B B $25.00 $19.00
COMPANY UPDATESCCL B B $67.00 $67.00CXO B B $160.00 $160.00
ESTE B B $9.00 $9.00
LSTR H H $105.00 $105.00
QEP H H $10.00 $10.00
R B B $63.00 $63.00
SAIA B B $70.00 $70.00
XPO B B $83.00 $83.00
GOLF B B $26.00 $26.00
ALB B B $120.00 $120.00AMZN B B $2,250.00 $2,250.00ELY B B $24.00 $24.00
CISN B B $16.00 $16.00CLVS B B $30.00 $30.00
CCI B B $120.00 $120.00
EWBC B B $59.00 $59.00EBAY H H $33.00 $33.00EXPO B B $56.00 $56.00
FLIR B B $55.00 $55.00GBCI B B $45.00 $45.00HTH B B $23.00 $23.00
Morning Meeting Highlights
Expert Call Today at 11:00 a.m. ET - Update on Recent OnlineVacation Rental Trends
Update on 4Q Online Vacation Rental Trends. We will host aconference call and Q&A session with VTrips' CEO, Steve Milo, foran in-depth discussion on recent trends in online vacation rentalsin the US. Companies discussed will include Booking Holdings,Expedia, Google, TripAdvisor and Airbnb. The format of the call willbe a presentation followed by Q&A.
• Update on 4Q trends for online vacation rentals across key USresort markets.• Get a read on the performance of the OTA channel for vacationrentals (HomeAway/EXPE, BKNG, Airbnb,TRIP)• Discussion on Google’s role in driving paid traffic to PropertyManagers.• Get the latest update on the fee assessed by OTAs on vacationrentals and pros/cons of each channel.
About VTrips:VTrips is a vacation rental management company in NorthAmerica with over 2,000 properties under exclusive managementin predominantly traditional sun-belt locations across the UnitedStates. VTrips bridges the gap between online rental marketplacesand traditional management companies by combining the valueadded services of traditional management companies with atechnology-enabled platform that allows consumers to browseproperties and book rental homes. The Company currentlyoperates 17 sub brands within 19 markets.
Featured Speaker:Steve Milo, Founder and CEO, VTrips
Hosted By:Naved KhanInternet and Digital Media Equity Research, SunTrust RobinsonHumphrey
Dial-in Information:Dial-in: 800-369-1906Participant passcode: 6124341
Exploration & Production - E&P - 4Q18/2019 Permian Preview;Returns Along with Growth Key - Neal Dingmann
Trucking & Logistics - Trucking & Logistics - Reiterating OurBuy Ratings on Ryder, SAIA, and XPO - This is a follow up toour launch on the T&L industry. Recent data points and earlyearnings announcements reinforce our view that we are in a latecycle demand environment with moderating growth expectedfrom record 2018 levels. While the T&L group underperformedthe S&P by 15% in 4Q18, it has outperformed by 400bps YTD asearly earnings reports and favorable 2019 pricing commentaryhave surprised to the upside. We are reiterating our Buy ratingson three of our favorite ideas (R, SAIA, XPO) as we view each
SEE PAGE 10 FOR REQUIRED DISCLOSURE INFORMATION Page 1
Equity Research
LGF.B B B $21.00 $21.00MDWD B B $9.00 $9.00MGP B B $32.00 $32.00SBCF B B $32.00 $32.00SLG B B $103.00 $103.00
TGI H H $16.00 $16.00UMPQ B B $22.00 $22.00
VNO B B $74.00 $74.00
WAL B B $57.00 $57.00
INDUSTRY UPDATES
Energy - Crude Inventories Higher Than Expected on Higher NetImports
Energy - Energy - Gas Positive; -163 bcf vs BBERG's -155 bcf andSTRH -159 bcf
Internet and Digital Media - Internet -Earnings on Deck! Expecting InLine Results with Lowered Expectations
Today's Events1/25 11 AM EST Conference Call with vTrips - Online Vacation
Rental Trends - Khan
have unique growth drivers and catalysts to outperform theirpeers over the next year. - Stephanie Benjamin
Cruise Lines - Cruise: Latest booking & pricing intelligenceagain show Carib & Alaska solid - Overall, our latest intelligenceon forward pricing and booking volumes from travel agenciesand other sources came in positive with a few CCL specificexceptions. Because of the strength described below we believeNCLH and RCL have left themselves upside to raise yieldguidances modestly as the year progresses. Also for reasonsdescribed below we have less confidence in CCL to do so. Ofthe three cruise stocks NCLH is our favorite due to their outsizedexposure to the luxury market, the high-end customer continuingto show the greatest strength. - C. Patrick Scholes
Other Focus Items Today
Consumer
Cruise Lines - Cruise: Latest booking & pricing intelligenceagain show Carib & Alaska solid - Overall, our latest intelligenceon forward pricing and booking volumes from travel agenciesand other sources came in positive with a few CCL specificexceptions. Because of the strength described below we believeNCLH and RCL have left themselves upside to raise yieldguidances modestly as the year progresses. Also for reasonsdescribed below we have less confidence in CCL to do so. Ofthe three cruise stocks NCLH is our favorite due to their outsizedexposure to the luxury market, the high-end customer continuingto show the greatest strength. - C. Patrick Scholes
Leisure Products - Highlights from The PGA Merchandise Show(ELY, GOLF) - Michael Swartz
Electric Power and Utilities
American Electric Power Company, Inc. (AEP, $77.47, Buy)- On Track For Above Average Long Term Earnings Growth- Based on 4Q trends, and future cap ex plans, we remainconfident in AEP’s ability to generate an above average (6%+)EPS CAGR going forward. Based on latest peer valuations, wehave raised our price target to $84 from $83. - Ali Agha
Energy
Exploration & Production - E&P - 4Q18/2019 Permian Preview;Returns Along with Growth Key - Neal Dingmann
Energy - This week's inventory report appears neutral in ourview. After digging into the data, Total crude & primary productinventories increased 11.4 MMBbls WoW, above the 3.5MMBbls estimated build. Higher net crude imports (+ 11.1 MM Bbls)account for the 7.97 MMBbls build in crude. Net product exportsincreased 3.3 MM Bbls, contributing to the 1.28 MM Bbl totalproduct inventory decline. Refinery utilization, at 92.9% continuesto run above expectations and the prior five year average of
STRH Daily Spotlight • January 25, 2019
Page 2 of 12
88.4% for the same week. OPEC + production cuts may not befully reflected in imports until mid Feb. - Ken Sill
Energy - This week's 163 bcf withdrawal was a positive versusthe Bloomberg consensus estimate of 155 bcf. Please see thetable and accompanying graphs below for details. In addition,please see our Gas Storage Preview (note). - Welles Fitzpatrick,Neal Dingmann, Ken Sill, Tristan Richardson
Kinder Morgan, Inc. (KMI, $17.24, Buy) - Shrink (the BalanceSheet) to Grow (the Multiple) - Capital allocation strategy wasthe overarching theme at Analyst Day and in our view will bethe key driver of KMI shares this year. An attractive Nat Gasoutlook (ahead of our initial take) poises Kinder to post modestgrowth in 2019. We see current valuation as below peers due toa relatively lower growth profile and uncertainty around capitalallocation. We generally believe any cash flow above and beyondthe growth forecast (ie asset sales) could move leverage belowthe 4.5x target and would drive multiple expansion. We arereducing our PT from $23 to $20 and rate the shares Buy. -Tristan Richardson
Financials
Glacier Bancorp, Inc. (GBCI, $43.27, Buy) - Lower Fee Incomeand Higher Expenses offset NIM Expansion; EPS Miss - MichaelYoung
Hilltop Holdings Inc. (HTH, $19.37, Buy) - 4Q Core EPS MissDue to Insurance Losses and Elevated Provisioning - MichaelYoung
Seacoast Banking Corporation of Florida (SBCF, $28.15, Buy)- Core EPS In Line; Strong Core and Reported NIM ExpansionOffset Growth Investment Expense - Michael Young
Western Alliance Bancorporation (WAL, $44.70, Buy) - LowerTax Rate and 24% Loan Growth Highlight the 4Q18 EPS Beat;TBV Grows Over 20% in 2018 - Michael Young
Umpqua Holdings Corporation (UMPQ, $17.35, Buy) - CostRationalization in 2019 Key to Achieving Above Peer ROTCE;Buy - UMPQ restructuring efforts are now in middle innings aftersuccessfully executing year one of the three year profitabilityimprovement plan with more visable progress in the back half of2019. We continue to believe cost rationalization should providean offset to decelerating industry revenue growth, but stability inmortgage is needed to see more tangible improvement. We aremaintaining our $22 PT (13.2x 2019E EPS) and adjusting ourcore 2019/2020 EPS estimates to $1.66/$1.78 from $1.68/$1.80previously reflecting lower revenue (estimates exclude impactsfrom MSR fair value changes). - Michael Young
Live Oak Bancshares, Inc. (LOB, $15.41, Hold) - 1Q19 BeingImpacted by Government Shutdown; Maintain Hold - We aremaintaining our Hold rating and revising our 2019/2020 EPSestimates to $0.26/$0.93 from $0.36/$0.98 and our PT to $15from $17. LOB is transitioning to a small business bank from an
STRH Daily Spotlight • January 25, 2019
Page 3 of 12
SBA lender as it sells fewer loans and launches more lendingand deposit products. LOB is also more focused on expensecontrol. However, the government shutdown has stopped SBAguarantees and loan sales for now, which should negativelyimpact 1Q19 results. At 14.8x 2020E EPS/1.2x TBV versus thepeer median of 11.7x/2.04x, the shares remain close to fairlyvalued on an EPS basis, in our view. - Jennifer Demba
United Community Banks, Inc. (UCBI, $25.96, Hold) - SteadyLoan Growth and Likely NIM Expansion; Maintain Hold onValuation - We are maintaining our Hold rating, revising our2019/2020 EPS estimates to $2.30/$2.40 from $2.32/$2.40 andadjusting our PT to $29 from $25. The EPS revision reflectshigher spread income growth partially offset by higher expensesand higher provisioning. UCBI should be making more strides inAtlanta commercial banking following the hiring of a metro marketpresident. The NIM bias remains positive as well. At 10.3x 2020EEPS/1.8x TBV versus the peer median of 11.0x/1.9x, the sharesare close to fairly valued in our view. We would be more positiveon a pullback in the share price. - Jennifer Demba
East West Bancorp, Inc. (EWBC, $50.27, Buy) - Robust GrowthSupported 4Q18 EPS Beat; 2019 Outlook Favorable - MichaelYoung
Healthcare
Clovis Oncology, Inc. (CLVS, $23.94, Buy) - EU Approval forRubraca in Ovarian 2L Maintenance, Look Forward to ExpansionInto Prostate - While the EU approval for Clovis’ Rubraca insecond line maintenance therapy in ovarian cancer was mostlyexpected, we are encouraged by the leveling of the playingfield in ovarian cancer for Clovis. All three PARP players; GSK/TESARO (GSK, NR), AstraZeneca (AZN, NR) and now Clovishave a broad label in ovarian cancer in the EU. We’ve alsorolled out 2019 quarterly estimates for Clovis, with no significantchanges to the underlying model or PT, and we have adjusted4Q18 for the positive pre-announcement of Rubraca sales—4Q call is scheduled for Feb 26. We reiterate our Buy rating and$30PT. - Peter Lawson
MediWound Ltd. (MDWD, $4.56, Buy) - US TAM for NexoBrid- Given the very strong top-line results for NexoBrid’s US pivotaltrial (DETECT) announced on Tues., we revisit our scaling for theUS TAM. We est. the TAM to span 16%-44% of US admissions w/a burn diagnosis. Assuming a treated 10% avg. % body surfacearea & ex-US pricing of ~$600 / % BSA equates to a $60M-$160M TAM range, w/ a bias towards the mid-point or above.Despite the clinical advantages of NexoBrid, it is difficult to predictthe pace of adoption because of necessary changes in clinicalprotocol & secondarily due to potential misalignment of financialincentives. Our DCF PT remains $9 - Bruce Nudell
Industrials
STRH Daily Spotlight • January 25, 2019
Page 4 of 12
Albemarle Corporation (ALB, $74.02, Buy) - Resolutionwith Chilean Regulator Removes Potential Overhang - JamesSheehan
FLIR Systems, Inc. (FLIR, $44.70, Buy) - Soldier Borne SensorContract a Positive Sign - Michael Ciarmoli
Triumph Group, Inc. (TGI, $13.27, Hold) - Global 7500 WingTransition to Bombardier Dramatically Reduces Risk Profile -Michael Ciarmoli
IT Services
Exponent, Inc. (EXPO, $50.82, Buy) - Anticipating ConservativeTop-Line Outlook - We lower our 2019 net revenue estimateto $379M from $390M in anticipation of the company issuingconservative 2019 guidance following conclusion of the largehuman factors project in August. We still believe that thecompany can generate 6-9% long-term organic sales growth dueto industry client teams deepening customer relationships. Our$56 PT assumes a stable EV/'20 EBITDA (including free cashflow) of 26.1x. Maintain Buy. - Tobey Sommer
Real Estate Investment Trusts
SL Green Realty Corp. (SLG, $86.35, Buy) - Lowering 2020FFO Estimate Slightly; Maintain $103 PT and Buy Rating - Wewere a bit surprised to see SLG fall 2.0% today versus +0.2%for the RMZ, but we continued to hear a wide range of investorconcerns regarding NYC office fundamentals/asset values,the upcoming Ralph Lauren expiration and ground lease resetat 625 Madison, and the two loan loss reserves in the DPEbook (the only truly new item on this list). There may also havebeen some mean reversion following YTD outperformance. Webelieve SLG is undervalued at a nearly 6% implied cap rate,and management’s continued commitment to dispositions/stockrepurchases should help close the deep discount to NAV. -Michael Lewis
MGM Growth Properties LLC (MGP, $29.29, Buy) - MGMannounces strategic real estate evaluation; Reiterate Buy onMGP - Barry Jonas
Vornado Realty Trust (VNO, $65.63, Buy) - Updating Model forAnnounced 4Q18 Non-Recurring Net Gains - We are updatingour model after VNO provided a handful of non-recurring itemsto be included in 4Q18 results. Notably $67.3M of after-tax 220CPS condo income will be recorded in 4Q, though no additionaldetails regarding the project were provided in yesterday’s pressrelease. Our 4Q18 and FY18 NAREIT-defined FFO estimates goup due to the items provided, and our normalized FFO estimatesgo down slightly as a result of higher property taxes due to re-assessment of theMART. Our 1Q19 and FY19 estimates go upa bit, as those property taxes are expected to be reimbursed bytenants. - Michael Lewis
TMT
STRH Daily Spotlight • January 25, 2019
Page 5 of 12
Amazon.com, Inc. (AMZN, $1,654.93, Buy) - Expecting Solid4Q18; Reiterate Buy - We maintain a Buy rating and $2,250 PTon AMZN ahead of 4Q results due out 1/31 AMC. We expecta strong performance, with total revs of +19% Y/Y (~20% excl.WFM), driven by share gains from retail, robust 3P and AWS, anda growing online ad segment. Our research indicates acceleratingY/Y growth Q/Q in e-commerce for 4Q, on the back of lowunemployment and favorable consumer sentiment. However, wenote that AMZN has had a mixed history in surpassing Streetexpectations for 4Q revs, with last year being the first time since4Q 2009 to do so. - Youssef Squali
eBay Inc. (EBAY, $32.65, Hold) - 4Q18/FY19 Outlook Likelyin Line with Muted Expectations; Maint. Hold - We maintaina Hold/$33 PT going into 4Q18 earnings due out Tuesday1/29. We expect the results and FY19 outlook to be in line withmuted Street expectations, showing no material improvementin growth for core Marketplace. Disappointing 4Q18 results/FY19 outlook would put more pressure on mgt and the board,who are now subject to activism by Elliott Mgt (see note here),who's challenging them on their go-forward strategy with CoreMarketplace and prospects for a StubHub/Classifieds spin off. Wenote that Starboard has also taken a stake/been quietly lobbyingmgt to maximize shareholder value. - Youssef Squali
Internet and Digital Media - The STII was down 0.1% thisweek vs. S&P +0.9%, though still ahead YTD at +11.9% (S&P+5.3%). Earnings season gets into full swing for us next week(EBAY, FB, BABA, AMZN, CMPR, and APRN), and given loweredexpectations following broadly weaker 3Q18 results for thegroup, we anticipate generally in line with-muted-expectationsresults and FY19 guidance. We favor AMZN, GOOGL and FB.Separately, we attended AdExchanger Conference and cameaway incrementally positive for AMZN around the rise of brandsproducts within its mktg platform and for FB around the popularityof Stories. - Youssef Squali, Naved Khan
Avnet, Inc. (AVT, $41.65, Hold) - Anticipate cycle weaknessto extend from here; Hold - Management's optimism does notalign with our cyclical concerns. AVT delivered a mixed quarter,and guided below consensus reflecting a similar tone to whatsuppliers experienced a quarter ago. We believe we will see atleast one, maybe more, negative revisions from here. Our CY19EEPS goes to $4.52 (from $4.60), and we establish our CY20EEPS estimate of $5.65 (buybacks help EPS growth here). PTgoes to $45 (from $42), based on ~9x CY20E EPS. - WilliamStein
Intel Corporation (INTC, $49.76, Hold) - Mixing, rather thanlowering, the 2019 bar; Raising PT to $53 - We expected a biggercut. After a string of impressive results (tempting us to upgrade),INTC delivered a mixed Q4, weak Q1 guidance, and mixed 2019guidance (lower sales, higher EPS) that was not the sort of resetthat we anticipated. We expect INTC's business to rebound from1Q19 through 2H19, but headwinds (competition, macro/trade,& modems) may challenge the hockey-stick guide. We raiseour CY19 EPS 7c to $4.61 & establish CY20 EPS at $4.85. PT
STRH Daily Spotlight • January 25, 2019
Page 6 of 12
increases $3 to $53, based on ~11x CY20 EPS. In large capcyclical tech we prefer AVGO (Buy); its div yield & EPS growthare both ~2x INTC's. - William Stein
Cision Ltd. (CISN, $12.07, Buy) - Former Falcon.ioShareholders Register Their 5m CISN Shares - MatthewThornton
Crown Castle International Corp. (CCI, $110.27, Buy) -Earnings Call Highlights Fundamental Strength, SupportsThesis; Maintain Buy, $120 Target - Our investment thesis onCCI is unchanged following this morning’s 4Q18 earnings call.Underlying fundamental drivers remain strong across towers,small cells, and fiber, in our view, which could enable CCI todeliver upside to revised guidance. Further, management’scomments that 2019 development spend can be funded withoutan equity issuance should remove another potential overhang forinvestors. With 5G network spending tailwinds supporting long-term 7-8% dividend growth, we reiterate our Buy rating and $120target. - Greg Miller
Lions Gate Entertainment Corp. (LGF.B, $17.20, Buy) - DebtRaise To Pay Down Revolver (No Surprise), F3Q19 (December)Results Tracking In-Line - Matthew Thornton
Transportation
Trucking & Logistics - Trucking & Logistics - Reiterating OurBuy Ratings on Ryder, SAIA, and XPO - This is a follow up toour launch on the T&L industry. Recent data points and earlyearnings announcements reinforce our view that we are in a latecycle demand environment with moderating growth expectedfrom record 2018 levels. While the T&L group underperformedthe S&P by 15% in 4Q18, it has outperformed by 400bps YTD asearly earnings reports and favorable 2019 pricing commentaryhave surprised to the upside. We are reiterating our Buy ratingson three of our favorite ideas (R, SAIA, XPO) as we view eachhave unique growth drivers and catalysts to outperform theirpeers over the next year. - Stephanie Benjamin
STRH Daily Spotlight • January 25, 2019
Page 7 of 12
Upcoming Events:
Jan 28-29: Mgmt Meetings around Americas Lodging Investment Summit with PK, PLYA, HLT - Industry Event
Jan 30: CBR Hotels' Americas Research (CBG) - NDR - Sr. Managing Director (Los Angeles)
Jan 31: GMS Inc. (GMS) - NDR - CEO; Interim CFO; VP, IR (Boston)
Feb 5-6: Viking Therapeutics (VKTX) - NDR - CEO (Boston & New York)
Feb 6-7: Graco, Inc (GGG) - NDR - CFO; IR (New York)
Feb 11: PureTech Health - NDR - CEO; CFO; CSO (Baltimore)
Feb 13: Malibu Boats, Inc (MBUU) - Group Dinner at the Miami Boat Show (Miami) - NEW
Feb 14: FleetCor Technologies, Inc (FLT) - NDR - CFO; IR (West Coast)
Feb 19: Hasbro, Inc. (HAS) - Group Meeting at NYC Toy Fair - CEO; CFO; COO (New York) - NEW
Feb 20: Mgmt Meetings around Int'l Homebuilders' Show with ABC Supply (private) and SRS Roofing (private)
Feb 25-26: Winnebago Industries, Inc. (WGO) - NDR - CEO; Director, IR (West Coast) - NEW
Feb 25-27: Glacier Bancorp, Inc. (GBCI)- NDR - CEO; CFO (KC, Boston, New York)
Feb 26-27: James River Group Holdings (JRVR) - NDR - CIO (New York & Boston)
March 6-8: Seacoast Banking Corporation of Florida (SBCF) - NDR - CEO; CFO; CMO (West Coast) - NEW
March 11: FLIR Systems, Inc. (FLIR) - NDR - CEO; Director, IR (Boston) - NEW
March 12: Ducommun, Inc (DCO) - NDR - CFO (New York) - NEW
March 13-14: The Rubicon Project Inc (RUBI) - NDR - CFO; VP, IR & Head of Global Real Estate (West Coast)
March 14: Euronet Worldwide, Inc. (EEFT) - NDR - CEO (Boston)
March 18-20: Brown & Brown, Inc. (BRO) - NDR - CFO (West Coast) - NEW
March 20: Amedisys, Inc. (AMED) - NDR - President/CEO; COO; CFO; Chief of Staff/VP, Strategic Finance
Bus Tours & Field Trips
Jan 28-29: Las Vegas Bedding Market Field Trip (Las Vegas)
March 20: Boxed.com (Private) Field Trip (New Jersey) - NEW
Conferences/Summits:
Feb 28: Texas Bank Summit
March 3-6: ShopTalk Management Meetings (Las Vegas) - NEW
March 19-20: Atlanta Bank Summit
April 3: 3rd Annual Utility & Power Summit (New York) - NEW
May 7-8: 5th Annual Life Sciences Summit - New York
May 21-22: 20th Annual Financial Services Conference - New York
May 21-22: 6th Annual Internet/Digital Media Conference - San Francisco
June 12: 2nd Annual Midstream Summit - New York
Conference Call:
Jan 25: 11 AM EST Conf Call with vTrips- Online Vacation Rental Trends - NEW
Jan 29: 11 AM EST Conf Call with Cushman & Wakefield on Retail Real Estate
Feb 4: 10 AM EST Conf Call with Industry Expert from STR - NEW
STRH Daily Spotlight • January 25, 2019
Page 8 of 12
Analyst Marketing:
Jan 30: Tobey Sommer - Business/Government Services (Midwest)
Feb 2-7: Tobey Sommer - Business/Government Services (West Coast)
Feb 5-6: Jennifer Demba & Michael Young - Banks (Canada)
Feb 11-12 - Charley Brady - Industrials (Canada) - NEW
Feb 13-14: Frank Atkins - IT Services (Canada) - NEW
Feb 20-21: Andrew Jeffrey - Transaction Processing (Mid Atlantic)
Feb 20-21: Terry Tillman - Software (Canada) - NEW
Feb 22: Jennifer Demba & Michael Young - Banks (Southeast) - NEW
Feb 27-28: Stephanie Benjamin - Consumer Staples (Canada)- NEW
Feb 28-March 1: Andrew Jeffrey - Transaction Processing (Texas) - NEW
March 1: Jennifer Demba and Michael Young - Banks (Texas)
March 5: Sandy Draper - Healthcare IT (Canada)
March: 6-8 Keith Hughes - Building Products/Durable Goods (Canada)
March 7-8: Ali Agha - Utilities & Power (Boston) - NEW
March 12: Sandy Draper - Healthcare IT (Canada)
March 12-13: Andrew Jeffrey - Transaction Processing (Boston)
March 13-14: Ali Agha - Utilities & Power (Midwest) - NEW
March 14-15: Jennifer Demba and Michael Young - Banks (Mid Atlantic)
March 20-21: Ali Agha - Utilities & Power (West Coast) - NEW
March 26-27: Jennifer Demba and Michael Young - Banks (New York)
STRH Daily Spotlight • January 25, 2019
Page 9 of 12
Analyst CertificationBy issuing this research report, each SunTrust Robinson Humphrey, Inc. analyst named in this report hereby certifies that therecommendations and opinions expressed accurately reflect the research analyst’s personal views about any and all of thesubject securities or companies discussed herein and no part of the research analyst’s compensation was, is, or will be, directly orindirectly, related to the specific recommendations or views expressed in this report.
Required DisclosuresAnalyst compensation is based upon stock price performance, quality of analysis, communication skills, and the overall revenueand profitability of the firm, including investment banking revenue.
As a matter of policy and practice, the firm prohibits the offering of favorable research, a specific research rating or a specifictarget price as consideration or inducement for the receipt of business or compensation. In addition, associated persons preparingresearch reports are prohibited from owning securities in the subject companies.
Charts indicating changes in ratings can be found in recent notes and/or reports at our website or by contacting SunTrustRobinson Humphrey. Please see our disclosures page for more complete information at https://suntrust.bluematrix.com/sellside/Disclosures.action.
STRH Ratings System for Equity SecuritiesDissemination of Research
SunTrust Robinson Humphrey (STRH) seeks to make all reasonable efforts to provide research reports simultaneously to alleligible clients. Reports are available as published in the restricted access area of our website to all eligible clients who haverequested a password. Institutional investors, corporates, and members of the Press may also receive our research via third partyvendors including: Thomson Reuters, Bloomberg, FactSet, and S&P Capital IQ. Additional distribution may be done by salespersonnel via email, fax, or other electronic means, or regular mail.
For access to third party vendors or our Research website: https://suntrustlibrary.bluematrix.com/client/library.jsp
Please email the Research Department at mailto:[email protected] or contact your STRH salesrepresentative.
The rating system effective as of Oct. 7, 2016:
STRH Rating System for Equity Securities
SunTrust Robinson Humphrey (STRH) rates individual equities using a three-tiered system. Each stock is rated relative to thebroader market (generally the S&P 500) over the next 12-18 months (unless otherwise indicated).
Buy (B) – the stock’s total return is expected to outperform the S&P 500 or relevant benchmark over the next 12-18 months(unless otherwise indicated)
Hold (H) – the stock’s total return is expected to perform in line with the S&P 500 or relevant benchmark over the next 12-18months (unless otherwise indicated)
Sell (S) – the stock’s total return is expected to underperform the S&P 500 or relevant benchmark over the next 12-18 months(unless otherwise indicated)
Not Rated (NR) – STRH does not have an investment rating or opinion on the stock
Coverage Suspended (CS) – indicates that STRH’s rating and/or target price have been temporarily suspended due to applicableregulations and/or STRH Management discretion. The previously published rating and target price should not be relied upon
STRH analysts have a price target on the stocks that they cover, unless otherwise indicated. The price target represents thatanalyst's expectation of where the stock will trade in the next 12-18 months (unless otherwise indicated). If an analyst believesthat there are insufficient valuation drivers and/or investment catalysts to derive a positive or negative investment view, they mayelect with the approval of STRH Research Management not to assign a target price; likewise certain stocks that trade under$5 may exhibit volatility whereby assigning a price target would be unhelpful to making an investment decision. As such, withResearch Management‘s approval, an analyst may refrain from assigning a target to a sub-$5 stock.
Legend for Rating and Price Target History Charts:
STRH Daily Spotlight • January 25, 2019
Page 10 of 12
B = BuyH = HoldS = SellD = Drop CoverageCS = Coverage SuspendedNR = Not RatedI = Initiate CoverageT = Transfer Coverage
The prior rating system until Oct. 7, 2016:
3 designations based on total returns* within a 12-month period**∙ Buy – total return ≥ 15% (10% for low-Beta securities)***∙ Reduce – total return ≤ negative 10% (5% for low Beta securities)∙ Neutral – total return is within the bounds above∙ NR – NOT RATED, STRH does not provide equity research coverage∙ CS – Coverage Suspended*Total return (price appreciation + dividends); **Price targets are within a 12-month period, unless otherwise noted; ***Low Betadefined as securities with an average Beta of 0.8 or less, using Bloomberg’s 5-year average
SunTrust Robinson Humphrey ratings distribution (as of 01/25/2019):Coverage Universe Investment Banking Clients Past 12 Months
Rating Count Percent Rating Count Percent
Buy 464 64.62% Buy 120 25.86%Hold 252 35.10% Hold 29 11.51%Sell 2 0.28% Sell 0 0.00%
Other DisclosuresInformation contained herein has been derived from sources believed to be reliable but is not guaranteed as to accuracy and doesnot purport to be a complete analysis of the security, company or industry involved. This report is not to be construed as an offer tosell or a solicitation of an offer to buy any security. SunTrust Robinson Humphrey, Inc. and/or its officers or employees may havepositions in any securities, options, rights or warrants. The firm and/or associated persons may sell to or buy from customers on aprincipal basis. Investors may be prohibited in certain states from purchasing some over-the-counter securities mentioned herein.Opinions expressed are subject to change without notice. The information herein is for persons residing in the United States onlyand is not intended for any person in any other jurisdiction.
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