UPDATE: Bank of America Merrill Lynch Raises PO on K12 to $40 (LRN)

Bank of America Merrill Lynch is out with its report today on K12 LRN, raising its PO from $38 to $40. In a note to clients, Bank of America Merrill Lynch writes, "K12's results continue to be impacted by recent acquisitions. However, the political backdrop is improving the outlook for FY12 and has the potential to drive accelerating organic growth. Our $40 target is based on 40x our updated CY12E EPS of $1. This is up from 31x but below K12's current 45x CY11 multiple and a slight discount to its 41x 5-year median forward P/E." Bank of America Merrill Lynch maintains Buy on LRN. Shares of LRN closed Tuesday at $35.36, down 3.62% from Monday's close.