RJF - Evercore cut to Equalweight at Morgan Stanley as deal headwinds likely in 2022

Morgan Stanley analyst Manan Gosalia downgrades Evercore (NYSE:EVR) to Equalweight from Overweight as the boutique advisory firm is skewed toward large deal activity, which is likely to face headwinds in 2022 on increased antitrust scrutiny. "While the stock is cheap at 11x our 2022 EPS and we still see 15% upside, that is lower than the 25% upside we see for our Overweight names," Gosalia writes in a note dated Dec. 7. Evercore (EVR) shares fall 1.2% in premarket trading. For the industry, the analyst shifts to an In-Line View from Attractive. The setup heading into 2022 is "more nuanced" than the strong outlook a year ago. On the plus side: GDP growth is still strong, sponsors have plenty of capital available for investing, and tech/COVID-related disruption is driving deals among corporates. Potential negatives: the Fed's tapering and higher rates could reduce credit available for deal, increased antitrust activity, and volatile

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Evercore cut to Equalweight at Morgan Stanley as deal headwinds likely in 2022