UPDATE: Morgan Keegan Raises Target On Emeritus Corporation (ESC)

Morgan Keegan is raising its price target on shares of Emeritus Corporation ESC to $31 from $24, and is reiterating its Outperform rating.

In a note to investors, Morgan Keegan writes, "We believe that investor sentiment has turned for senior housing operators, given the confluence of a recovering economy, very limited new supply, and stable labor costs. We are moving our valuation metric for Emeritus from a 1.0 multiple of CFFO growth to a 15% premium. Applied to our revised 2011 CFFO estimate, this yields a revised $31 price target."

Shares of ESC gained 61 cents yesterday to close at $24.50, a gain of 2.55%.