UPDATE: Stifel Nicolaus Raises PT on SPX Corporation on Earnings Growth Potential

In a report published Thursday, Stifel Nicolaus analyst Nathan Jones reiterated a Buy rating on SPX Corporation SPW, and raised the price target from $87.00 to $91.00.

In the report, Stifel Nicolaus noted, “Despite a $0.15 beat on 2Q13 guidance, SPW reduced full year guidance by $0.075 at the midpoint. We expected this reduction in 2H guidance to negatively impact the share price, but the shares closed up almost 2%. We believe this is due to the low expectations currently surrounding the company due to soft markets, poor execution, and management missteps. While there were puts and takes in the guidance and lingering softness in certain end markets, we believe investors should be focused on the earnings growth potential available through improved operations. While we agree that the responsibility for the underperformance of these businesses lies largely at management's feet and partially in soft markets, we believe the company is singularly focused on improving operations and margins. With solid execution we believe the company can grow earnings at ~25% CAGR over the next few years and that the current 13.4x 2014E EPS does not reflect that outcome. Given that potential we are adding SPW shares to the Stifel Select List as our top investment idea. In addition, we are increasing our target price from $87 to $91.”

SPX Corporation closed on Wednesday at $76.41.