UPDATE: Credit Suisse Reiterates Neutral Rating, Raises PT on Spirit AeroSystems Holdings Following Q2 EPS Report

In a report published Tuesday, Credit Suisse analyst R. Spingarn reiterated a Neutral rating on Spirit AeroSystems Holdings (NYSE: SPR), and raised the price target from $17.50 to $25.00.In the report, Credit Suisse noted, “Ex-charges, Spirit reported Q2 EPS of $0.72, a strong beat against the Street's $0.50, driven by better Fuselage & Propulsion margins. However, consistent with last week's pre-announcement, $448M of charges on wing programs resulted in reported EPS of $(1.47). Charges are related to the Gulfstream G280 & G650 programs (as expected) and the 787 wing (new today). As disclosed last week, SPR continues to pursue a sale of its OK facilities. Management was clear that this is not a ‘fire sale' but they believe there may be a ‘better owner' and said that multiple parties have shown interest in the assets. While we remain concerned that a sale may prove difficult, and that the coming quarters will yield further charges as Spirit progresses through its strategic and financial review, we recognize that a sale of Oklahoma should make the company's EPS stream more reliable, as it rids it of problem programs. As such, we now value the stock solely on P/E, applying a 10.1x multiple (2014 peer average with a 20% discount for program execution and inferior cash flow) to our 2014 EPS of $2.51. This raises our TP to $25 (from $17.50). We reiterate Neutral. We are raising our 2013 EPS estimates to $0.16 (from $2.17).”Spirit AeroSystems Holdings closed on Monday at $24.64.