DA Davidson upgrades Manhattan Associates on overdone share correction

DA Davidson upgraded Manhattan Associates to Buy from Neutral with a price target of $240, up from $220. The stock correction this year is overdone, especially following a quarter where the company exceeded expectations and raised guidance, the analyst tells investors in a research note. The firm says the shares now trade below its three-year bottom quartile forward price-to-earnings ratio, “an attractive entry for buyers today.” The firm believes Manhattan is a “definitive” return on invested capital leader and “deserves more recognition from the market.” Manhattan “generates pre-tax return on invested capital of 135%, a number we had to triple-check and sanity-check with management,” writes DA Davidson.