UPDATE: Imperial Capital Initiates Precision Castparts at Outperform with $190 PT

Imperial Capital initiated coverage on Precision Castparts PCP with an Outperform rating and a price target of $190 for the next 12 months. Imperial Capital commented, "We believe PCP represents an attractive commercial aerospace holding with potential upside from both superior execution and additional acquisitions. We believe incremental margins of 30–40% are sustainable as volume increases, even with acquisition dilution. … Commercial aerospace exposure, and growing Boeing 787 leverage provides attractive original equipment cycle play. We favor OE leveraged stocks, and believe that the 787 alone will be a $1bn program for PCP at full-rate production. We see minimal near-term supply chain risk." Precision Castparts closed at $155.56 on Tuesday.