UPDATE: Deutsche Bank Downgrades Rexnord to Sell on Valuation, Macro Uncertainties
Deutsche Bank reduced its rating on Rexnord (NYSE: RXN) from Hold to Sell while raising its price target from $19 to $21.
Deutsche Bank said, "Rexnord is currently trading at just over $21 per share – a roughly 6-month high – and up roughly 40% from the lows in mid-August. At >$21 per share, RXN shares appear fully valued and share price could be pressured given macro uncertainties and elevated expectations, in our view. We remain particularly concerned about mining end markets which represent one of the company's largest customer exposures at an estimated 18% of sales this year. While Rexnord's mining-related sales have been trending up y/y, mining orders in the most recent quarter were down. Moreover, coal mining order trends sequentially deteriorated (coal represents roughly 1/3 of mining)."
Rexnord closed at $21.18 on Friday.
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