Morgan Stanley downgraded NerdWallet (NRDS) to Underweight from Equal Weight with a price target of $9, down from $14. The firm views consensus earnings estimates for the company as too high. NerdWallet can invest in marketing to drive revenue, but its degradation of search engine optimization and marketing spend will dilute return on equity and margins, the analyst tells investors in a research note. Morgan Stanley cites this dynamic, limited visibility and NerdWallet’s “constrained” liquidity for the downgrade to Underweight.
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