Deutsche Bank Lowers Price Target On MDC Partners

In a report published by Deutsche Bank, MDC Partners' MDCA outlook is stronger that 2011 EBITDA/FCF guidance shows.

Deutsche Bank said that it reiterates the Buy rating, but is lowering the price target to $21. “Despite an EBITDA miss and soft/conservative guide, we believe on a long-term basis that MDCA is one of the best ways to invest in the shift to digital, and has strong cash flow. MDCA should continue to outperform the large cap agencies on the top line, but another year of higher investment spend will dampen the profit ramp in 2011. This makes MDCA look expensive on a current year basis, but still attractive on 2012 at 7.0x EBITDA (peers 6.5-7x) and 13% FCF yield (9-10%).”

MDC Partners closed yesterday at $17.77.