NEW YORK (TheStreet) --  Wendy'sCo.  (WEN) - Get Report stock is lower 0.09% to $10.73 in morning trading Wednesday after Credit Suisse initiated coverage with an "underperform" rating and a $9 price target. 

"Our problem with the Wendy's story comes back to the ideas of valuation and growth.  We have a very difficult time justifying the current Wendy's valuation in our DCF models, even when factoring in higher free cash flow post-refranchising," Credit Suisse said. 

The firm said it sees little opportunity for growth in EBITDA or free cash flow over the long term given a likely flattish store portfolio in the U.S./Canada and low/no growth internationally. 

"We believe the stock is being supported by the pending leveraged buyback, though this has been well-telegraphed to the market," Credit Suisse noted in their analysis. 

In addition, analysts said that even though it's not their call that McDonald's (MCD) - Get Report will see a near-term sales rebound, even a flattening out of sales trends for McDonald's could pressure Wendy's, following a period of severe share loss by McDonald's. 

Credit Suisse added that Wendy's same-store sales could benefit from improving macro trends and lower gas prices.

Separately, TheStreet Ratings team rates WENDY'S CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate WENDY'S CO (WEN) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

You can view the full analysis from the report here: WEN Ratings Report

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