Goldman Sachs Gives Color On Joy Global Following Earnings Miss

Joy Global

was down 3% on the 1Q earnings miss and subdued management incremental margin outlook comments. However, the miss was due to seasonally lower production rates, as results were in line with estimates that call for a sharper seasonal recovery in 2Q-4Q, and aftermarket demand and new equipment booking are accelerating faster than expected. Despite the 1Q miss, the key drivers of Goldman's Buy-rating on JOYG are intact as it believes declining mine ore grades will drive accelerating aftermarket sales through the heart of the upturn, and tight mine supply constraints provide visibility on a multi- year capex upturn, driving meaningful upside to consensus estimates. Goldman Sachs Raises Its PT from $105 to $114 on JOYG JOYG closed Wednesday at $94.32