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On Tuesday, Dun & Bradstreet (NYSE:DNB) experienced a change in stock rating, as Jefferies analysts downgraded the company from Buy to Hold. Accompanying this downgrade, the firm also adjusted the price target to $9.15 from the previous $11.00. The revision comes in the wake of Dun & Bradstreet’s recent agreement to be acquired by private equity firm Clearlake Capital for an enterprise value of $7.7 billion.
The acquisition by Clearlake Capital sets the purchase price for Dun & Bradstreet shares at $9.15, representing an 8% premium over the stock’s price before media reports on March 21st suggested a deal was imminent at approximately $9 per share. Jefferies’ downgrade reflects a new perspective on the stock’s potential, following the acquisition announcement.
Jefferies expressed surprise at the acquisition price, noting that it falls short of the price from Dun & Bradstreet’s 2019 take-private deal. This observation underscores the firm’s expectations for the company, given its performance improvements over the past five years in areas such as revenue growth, margins, pricing, and leverage.
The analysts at Jefferies believe that a competitive bid for Dun & Bradstreet is unlikely, which has influenced their decision to downgrade the rating to Hold. This suggests that they do not anticipate significant changes in the stock’s price in the near term, following the agreed acquisition terms with Clearlake Capital.
In other recent news, Dun & Bradstreet reported its fourth-quarter 2024 earnings, which fell short of both earnings per share (EPS) and revenue forecasts. The company recorded a modest revenue growth of less than 1% for the quarter, reaching $632 million, while the full-year revenue increased by 3% to $382.002 million. Despite these results, the company is focusing on strategic initiatives and product innovations to drive long-term growth. In a significant development, investment firm Clearlake Capital Group has entered into an agreement to acquire Dun & Bradstreet in a deal valued at $7.7 billion, including debt. The acquisition is expected to close in the third quarter of 2025, subject to shareholder approval and regulatory clearances. Meanwhile, analysts at Needham and Raymond (NSE:RYMD) James have both adjusted their price targets for Dun & Bradstreet shares to $14.00, maintaining a Buy and Strong Buy rating, respectively, despite the company’s recent financial performance. These adjustments reflect a belief in the company’s intrinsic value and potential for strategic growth.
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