Deutsche Bank Has Hold On Arkansas Best Corp.

Deutsche Bank has a Hold rating and a $24.00 price target on shares of Arkansas Best Corp. ABFS. In a note to clients, Deutsche Bank writes, "Yesterday during market hours, ABFS (Hold, $26.90) shares rallied 10.5% on news that the U.S. Court of Appeals for the Eighth Circuit reversed and remanded a lower court's previous dismissal of ABFS' lawsuit against the International Brotherhood of Teamsters (Teamsters), YRCW, Trucking Management Inc. (TMI), and other related entities. Under ABFS' original lawsuit that was filed in November 2010, ABFS sought to have a lower Court create a grievance review committee to resolve its dispute with the Team- sters or to have the contract amendments which benefited only YRCW declared “null and void" by the courts. Although we do not expect any cost savings near-term, we estimate that every $1/hour reduction in wages and/ or benefits equates to $0.37/share to our 2012 EPS estimate of $1.68 (or 22%). We do not expect any concessions from the Teamsters ahead of their general elections later this year, and note that any wage or benefit adjust- ments would need to be ratified by ABFS' rank and file. Accordingly, we have not made any adjustments to our 2011-12 EPS estimates on this news." Shares of ABFS gained $2.56 yesterday to close at $26.90, a gain of 10.52%.