Although Goldman Sachs’ Stephen Tanal holds a constructive view on the long-term prospects for Party City Holdco Inc
Tanal initiated coverage of the company with a Neutral rating and price target of $17.
Key Growth Drivers
The analyst believes there are three key growth drivers for Party City, including the persisting increase in the
“In 2016, however,
The analyst also expressed optimism regarding vertical integration as a growth driver, supported by bolt-on acquisitions expected to continue to drive margin expansion.
On the other hand, Tanal also cautioned that “share of shelf gains are slowing, and commodity tailwinds moderating.”
The third growth driver the analyst pointed out was balance sheet deleveraging, which could act as an EPS tailwind, although the leverage was elevated at present, with a “heavy mix of floating rate debt.”
However, deleveraging could help free up cash that could be put to more productive use, the analyst concluded.
|Oct 2016||Goldman Sachs||Initiates Coverage On||Neutral|
|Aug 2016||Goldman Sachs||Maintains||Neutral|
|Aug 2016||JP Morgan||Maintains||Overweight|
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