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Shares Of B/E Aerospace Rocket To New High Amidst Strategic Alternatives Options & Analyst Predictions

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JP Morgan Upgrades B/E Aerospace To Overweight

On Sunday, B/E Aerospace (NASDAQ: BEAV) announced that it has hired Shearman & Sterling LLP to explore strategic alternatives to enhance shareholder value.

The press release states, “These strategic alternatives could include, amongst others, a possible sale or merger of the Company; the sale, spin-off or other separation of selected businesses within B/E or other strategic transactions involving the Company or its businesses.”

Without a timetable or possible transaction listed, financial analysts are eager to discuss predictions.

In a note published Monday, Jefferies analyst Howard Rubel writes that B/E Aerospace may be sold for approximately $107.00 per share, a 20 percent upside from Friday's close of $88.96. Rubel remarked that there is an 85 percent probability that the company sells itself, and 15 percent chance of a consumables spinoff. Jefferies raised the price target on Buy rated B/E Aerospace from $95.00 to $107.00.

Sterne Agee raised the price target from $111.00 to $121.00. The firm noted that breaking up B/E Aerospace into two halves with consumables to PE would create the most value. Sterne Agee sets the value for consumables and commercial/bizjet segment at $35.00 to $43.00 per share and $70.00 to $89.00 per share, respectively.

Deutsche Bank sees Honeywell International (NYSE: HON), United Technologies (NYSE: UTX), General Electric (NYSE: GE) and Oppenheimer Emerging Markets as “unlikely” buyers. The analyst wrote that TransDigm Group Incorporated (NYSE: TDG) and Precision Castparts (NYSE: PCP) may “make a pass”, but their strategic logic is not clear. Deutsche Banks remarked that there is potential for B/E Aerospace to merge its consumable unit with other aerospace distribution companies, such as Wesco Aircraft (NYSE: WAIR), in a “tax-efficient manner.”

FBR and Canaccord reported that the company and news is “attractive” by investors. FBR remarked that they could “easily” see multiple bidders. Canaccord is more conservative in estimates, writing that it is “too early to speculate on potential merger partners or suitors.”

Shares of B/E Aerospace opened at a new high at $97.50. The stock continued to climb to $99.31. Shares remain strong, currently trading up 11.027 percent at $98.77.

Latest Ratings for BEAV

DateFirmActionFromTo
Sep 2014JP MorganUpgradesNeutralOverweight
Sep 2014Credit AgricoleReiteratesOutperform
Sep 2014Deutsche BankUpgradesHoldBuy

View More Analyst Ratings for BEAV
View the Latest Analyst Ratings

Posted-In: Analyst Color News Rumors Financing Price Target Asset Sales Legal Analyst Ratings

 

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