Advanced Drainage downgraded to Equal Weight from Overweight at Stephens

Stephens downgraded Advanced Drainage (WMS) to Equal Weight from Overweight with a price target of $135, down from $170. The company recently announced fiscal Q2 results that missed across the board and lowered FY25 guidance, reflecting weaker commercial demand, ongoing mix impacts, and negative price-cost given recent difficulty in passing-through rising material costs in the soft demand environment, the analyst tells investors. While the firm still believes in the longer-term conversion story, it thinks negative price-cost trends likely continue until demand returns.