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Wachovia Securities raised its investment rating on auto-financing company



Tuesday, saying it doesn't believe the company's review of its financials will significantly affect cash flow or shareholder equity.

The company's liquidity position is improving, according to analyst Joel Houck, who said fair value for AmeriCredit's shares is $11 to $12. The analyst upgraded the stock to outperform from market perform.

Last week, AmeriCredit said

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fourth-quarter earnings would fall short of its previous guidance and that it would delay releasing the results pending a review of its prior financials.

While Houck believes a possible restatement poses a downside risk to the company's shares, he said the current valuation outweighs that scenario.

Houck also said AmeriCredit's July credit quality data in its securitized auto-loan portfolio declined to $12.1 billion from $12.6 billion in June, which was somewhat better than his expectation. Additionally, the analyst said all other credit quality measures were flat to slightly better and that losses improved.

The company also said last week that it had $317 million in unrestricted cash at the end of June, which was ahead of Houck's $267 million estimate. Houck also believes that used car pricing has stabilized.

Shares of AmeriCredit closed at $7.28 Monday on the

New York Stock Exchange