Friday December 21, 06:08 PM
Rite Aid upgraded to "buy" - update
NEW YORK, December 21 (newratings.com) - Analysts at UBS (Virt-X: UBSN.VX - news) upgrade Rite Aid Corp (NYSE: RAD
- news) (ticker: RAD) from "neutral" to "buy." The 12-month target price has been reduced from $4.50 to $4.00.
In a research note published this morning, the analysts mention that the planned sale of the company's West Coast operations could result in inflows of nearly $2 billion. Rite Aid may deploy the sale proceeds for debt reduction and reinvestment in operations, the analysts say. The company could return to profitability in FY09, if it uses the divestment proceeds to repay debt and reinvest in its other businesses, UBS adds. The analysts expect Rite Aid's share price to remain volatile due to weaker-than-expected holiday sales.
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