UPDATE: JP Morgan Upgrades Rock-Tenn Company to Overweight on Pricing Increases and Execution
JP Morgan upgraded Rock-Tenn Company (NYSE: RKT) from Neutral to Overweight and raised the price target from $88.00 to $108.00.
JP Morgan said, "The primary driver is our view that the spring price increase attempt by G-P will be followed by the rest of the industry and ultimately successful, around which RKT has the most leverage. Aside from pricing, we also think that RKT is slowly chipping away at the integration of SSCC and earning back investor trust on execution. Finally, we believe that the company is set to generate meaningful FCF in years ahead, on which valuation is not expensive. Further, as leverage comes down (4.0x pension-adjusted FY12 to 1.7x by FY14E), we see opportunities to start returning cash to shareholders."
Rock-Tenn Company closed at $86.50 on Friday.
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