Citi Upgrades Apartment Investment And Management To Hold

According to Citi, Apartment Investment and Management AIV is an attractive relative 2Q trading opportunity. Citi reported that it is upgrading AIV to Hold (2H) from Sell (3S) as it believes there is an attractive relative trading opportunity in AIV's shares heading into 1Q results as the stock has underperformed peers by 810bps year-to-date and by 460bps since its disappointing guidance announcement on Feb 4th. “While longterm risks keep us cautious on the stock, we believe this underperformance should reverse in the near-term due to the high likelihood of a guidance raise and subsequent estimate increases. As discussed below, we believe that street estimates will rise ~6% over the next couple months to the $1.60-$1.70 range as analysts adjust their SSNOI growth estimates upward to the 4.0-5.5% range, which in turn should lead to multiple expansion (we assume ~4% expansion to 16.6x '11 FFO from 15.9x today). Overall, although our Hold rating is justified by a ~10% 12- month ETR and long-term risks remain, we expect short term outperformance vs. eers in 2Q. Upgrade to Hold and overweight in model portfolio; TP to $27.50.' Apartment Investment and Management closed yesterday at $24.99.