2U price target lowered to $5.75 from $21 at Morgan Stanley

Morgan Stanley lowered the firm’s price target on 2U to $5.75 from $21 and keeps an Equal Weight rating on the shares. The potential risk and the potential reward for equity holders are significant given capital structure and leverage, but while the management has laid the groundwork for a more optimistic “12-quarter” view, execution driving higher EBITDA, free cash flow, and stabilizing revenue is needed, the analyst tells investors in a research note.