Credit Suisse's Rating Changes

In a research report published today, Credit Suisse made a number of rating changes. Experian (EXPN) was upgraded to Outperform from Neutral, while the target price was raised to 910p from 860p. In the report, Credit Suisse states, "We think that Experian can grow revenues organically at 7-8% per year over the next years driven by structural growth in newer markets and products combined with cyclical recovery elsewhere. Positive mix change and operational gearing will lead to a 140bp increase in EBITA margins (FY11A to FY14E) on our estimates. Experian is a cash generative business, which we estimates will produce $2.6bn of excess cash over the next 4 years, which will be used for a combination of acquisitions and, we believe, share buy backs. After 6 months of tracking the market we think the stock is now discounting just 3% organic revenue growth (half the 10 year median) and no operational gearing." At the moment, Experian's shares are trading in London at $799.50, or 3.03% above yesterday's close. Credit Suisse also initiated coverage on a number of companies. PostNL (PTNL) was assigned a Neutral rating with a price target of €7.85. The report states, "We initiate on PostNL with a Neutral rating. Cash flow generation prospects should prove the key focus for investors as the business strives to drive sufficient cash flow to fund a minimum Eu150m per annum dividend target in a declining Dutch mail market. We expect the company to meet its target of underlying cash EBIT of Eu130m-Eu170m in 2011 (CS Eu142m) and Eu300m-Eu370m by 2015 (CS Eu313m). The fortunes of PostNL are very much tied to those of TNT Express (in which it holds 29.99%) in the short term, with the stake representing 46% of PostNL's market cap and it will need to sell to fund dividend plans. We are Neutral on TNT Express and do not see it as a value driver for PostNL absent a sale of the stake. We are Neutral on PostNL with 6% upside to our TP of Eu7.85." TNT Express (TNTE) was assigned a Neutral rating with a price target of €8.55. The report states, "Strong start to listed life overdone: TNTE rose 10% on 26 May on listing, which we view as overdone. Significant concerns regarding the company's future direction in emerging markets remain and, absent topical M&A potential, we do not see significant catalysts in the short term. We forecast underlying EBIT of Eu318m in 2011E (Eu112m on a reported basis), rising to Eu443m in 2012E assuming no further negative surprises in Brazil. We initiate with a Neutral rating with a TP of Eu8.55." At the moment, TNT is trading in Amsterdan at $9.76, or 0.57% above yesterday's close. Etalon (ETLNG) was assigned an Outperform rating with a price target of $10.60. In the report, Credit Suisse states, "In our view, Etalon has a good platform for sustainable growth due to (1) reliance on poured-concrete technology offering higher consumer qualities and geographical expansion flexibility that is unavailable in precast panel construction; (2) a focus on the 'economy comfort' price segment (higher end of mass-market to lower end of business class) which is both scalable (0.6m target households) and profitable-2011-12 EBITDA margin of 30% on our estimates; (3) a well-developed national sales network (29% of 2010 total sales originating from geographies outside of Etalon's operations); and (4) an optimal level of vertical integration. We see the benefits of Etalon's business model translating into 34% 2010-14E revenue CAGR." Air Lease Corporation AL was assigned an Outperform rating and price target of $34. The report states, "We Are Initiating Coverage of Air Lease Corporation (AL) with an Outperform Rating and a $34 Target Price: Air Lease has hit the ground running in terms of fleet growth since it was established in early 2010 and we expect more of the same over the next three years. We expect AL to generate average annual revenue growth of roughly 40% during its initial build-out phase through 2013." On Monday, Air Lease lost 0.42% to close the day at $28.43. Responsys inc. MKTG was assigned an Outperform rating and a price target of $22. The report states, "Responsys' leadership in SaaS enterprise marketing for Interactive channels (Email/Web/Mobile/Social) exposes the company to strengthening secular trends. We believe Responsys' market can expand to roughly $6b by 2014 from under $3b today and expect the company to grow its share as SaaS solutions are more widely adopted. While the bulk of the market today is siloed across interactive channels (using best of breed solutions independently), Responsys differentiates with an integrated cross-channel approach that enables efficiency and better analytics. The company's solution tends to be selected by forward thinking marketing organizations and we believe an integrated approach is where the market is headed. We see the high-end customers that are leveraging more sophisticated multi-stage campaigns across channels and optimizing every customer interaction becoming the mainstream and enabling Responsys to grow share." On Monday, Responsys added 1.23% to its value to close the day at $17.33. Tesoro Logistics LP TLLP was assigned an outperform rating with a price target of $28. The report states, "Initiating Coverage of Tesoro Logistics LP (TLLP) with Outperform: TLLP was formed to be Tesoro Corp's (TSO) vehicle to grow its logistics infrastructure business. Initially, substantially all of TLLP's revenue will be derived from TSO under various long-term, fee-based agreements that include minimum volume commitments. Contracts with TSO provide cash flow stability while drop-downs provide visible upside. Our model assumes that TLLP will acquire $200 million of assets from Tesoro Corp. from 2012-2015, enabling the MLP to grow its distribution at a five year CAGR of 8.0%." On Monday, Tesoro added 4.84% to its value to close the day at $24.49.