UPDATE: J.P. Morgan Reiterates Overweight Rating, Raises PT on Owens Corning
In a report published Monday, J.P. Morgan & Co. reiterated its Overweight rating on Owens Corning (NYSE: OC), and raised its price target from $34.50 to $38.00.
J.P. Morgan noted, “We view the company's current valuation as attractive, trading at only 6.4x our 2013E EBITDA, which we believe limits downside in the stock. Moreover, we continue to believe that as investors begin to shift their focus over the next 1-2 quarters towards OC's earnings potential in 2013 and beyond as it continues to execute its Composites strategy, this should drive multiple expansion against our 2013E. Lastly, we continue to believe the stock's valuation is attractive relative to the company's longer term earnings potential of at least $4/share over the next 2-3 years, which we note is already based on sub-20% Roofing margins. Hence, we maintain our Overweight rating, based on our outlook for material earnings improvement in 2013 and longer-term, as well as OC's attractive valuation, in our view.”
Owens Corning closed on Friday at $33.75.
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