UPDATE: Citigroup Maintains Neutral on Allison Transmission; Lowers PT from $22 to $21

Citigroup reiterated a Neutral rating on Allison Transmission

and lowered its price target from $22 to $21. Citigroup noted, “We rate shares of Allison Transmission Neutral with a $21 target price. We see benefits from efficiency gains and structural cost improvement being amplified as Allison realizes cyclical upside across certain of its core markets. High cash conversion, combined with management's disciplined focus on de-leveraging, also provide longer-term upside. That said, its high exposure to government spending, a freezing in Energy capex, and the company's levered balance sheet are risks we think could weigh on near-term volumes, and sentiment.” Allison Transmission closed at $18.39 on Monday.