UPDATE: Citigroup Resumes Buy, Raises PT to $60 on Eaton on Portfolio Transformation
Citigroup resumed coverage on Eaton (NYSE: ETN) with a Buy rating and increased its price target from $58 to $60.
Citigroup commented, "We resume coverage of ETN with a Buy rating, as we see attractive risk-adjusted (+20%) upside to our $60 target. We believe the Cooper transaction will help to drive value in multiple ways especially as it creates a broader Electrical franchise that we think will command a higher mid-cycle valuation. The complimentary nature of the deal, which raises ETN Electrical's exposure in Industrial and Utility markets (to a combined ~50%), should help in driving growth upside via synergy capture. Also, Cooper's strong track record of cash conversion, combined with ETN's focus on debt pay-down, should help make this a compelling de-leveraging story."
Eaton closed at $51.15 on Monday.
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