Zacks Investment Research upgraded shares of Western Refining, Inc. (WNR) from UNDERPERFORM to NEUTRAL on March 09, 2012, with a target price of $21.00.
We are upgrading shares of Western Refining to Neutral from Underperform based on its improved long term prospects and cheap valuation. An uptick in economic activity overseas and prospects for stronger fuel demand in the domestic market make us optimistic about the sector. Additionally, we believe Western Refining's strategic actions – to improve its performance and competitiveness in a cost-effective manner will drive growth in the company's profits and boost its stock valuation. Moreover, at current multiples, which are significantly lower than peers, we have a difficult time justifying an Underperform rating. However, Western Refining's comparatively thin liquidity position and lack of meaningful debt reduction keep us on the sidelines.
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