William Blair analyst Ryan Merkel last night downgraded HD Supply Holdings to Market Perform from Outperform after the company announced its intention to separate its Facilities Maintenance and Construction & Industrial businesses into two independent publicly traded companies. The shares, following the post-news rally, appear to be discounting a Facilities Maintenance sale near 12 times EBITDA in mid-2020, Merkel writes in a research note to investors. However, the analyst lacks confidence that a sale "happens anytime soon," and believes Construction & Industrial is unlikely to be sold near term due to "very limited" strategic buyers and cycle risks. He finds HD Supply "fully valued" at around $39 per share. Barclays analyst Julian Mitchell this morning also downgraded HD Supply Holdings to Equal Weight from Overweight. The stock in morning trading is down 2% to $38.30.