Morgan Stanley Remains Cautious On Navistar International

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In a report published Thursday, Morgan Stanley analyst Nicole DeBlase reiterated an Equal-Weight rating and $38.00 price target on
Navistar InternationalNAV
. In the report, Morgan Stanley noted, “NAV's execution has recently been the weakest in the Machinery group, as the company has missed its EBITDA targets in 4 of the last 5 quarters. Consensus already bakes in a mild NAFTA Class 8 recovery coupled with ~3-5ppts p.a. share regain, while our AlphaWise dealer survey suggests much more modest share regain of ~1ppt in 2014e. "We prefer to play an impending NAFTA Class 8 truck recovery via a higher quality name, with modest execution risk and less baked into consensus – PCAR. We do not view liquidity as a problem, as NAV sold $370m of 4.75% convertible notes in 2Q14.” Navistar International closed on Wednesday at $34.67.
Posted In: Analyst ColorReiterationAnalyst RatingsMorgan StanleyNicole Deblase
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