UPDATE: Credit Suisse Raises PT on Dover on Attractive Risk/Reward
In a report published Thursday, Credit Suisse analyst Julian Mitchell reiterated a Neutral rating on Dover Corp. (NYSE: DOV), and raised the price target from $65.00 to $68.00.
In the report, Mitchell noted, “We think the risk / reward now appears more attractive, but retain our Neutral rating given: (1) Uncertainty surrounding short-cycle pick-up...For 2 months, we have been concerned regarding consensus expectations for a major 2H re-acceleration in short-cycle industrial / consumer demand (hence our downgrade of ROK, and sector estimate cuts in our earnings preview); these results did little to dispel that concern. In P&ID, we note that y-o-y comparisons do not become much easier throughout the year (100bps easier relative to Q112), and most of the business is non-US, where the demand outlook is highly uncertain. For ES, two thirds of sales are Industrial / Fluids, where there is little evidence of an imminent rebound. (2) ....And Sound Solutions: Our forecasts embed a 70% pick-up in Comm Tech EBIT from Q113 to Q413, and the volatility of margins in CT (11.9% in Q113 vs 19.9% in Q310) makes us think this assumption is not overly conservative.”
Dover Corp. closed on Wednesday at $69.91.
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