Rockwell Collins' Outlook Stays Fresh

Rockwell Collins COL has reported 4Q results that were in-line with expectations and outlook has changed minimally since management reported initial FY2011 guidance only six weeks ago, according to JP Morgan. In the report, JP Morgan writes "Q4 was in line with little change to the outlook, which was not much of a surprise since management delivered initial FY11 guidance only about six weeks ago. The commercial aero aftermarket gained some steam, and we are still looking for double-digit growth next year. Commercial Systems will be the growth engine going forward, and we believe the risks to the outlook are more acute in Government Systems, but it appears that COL has the potential to grow Government EBIT modestly in FY11. COL remains our top long-term pick based on our expectations for above-average Commercial sales growth and high incremental margins to drive out-sized earnings growth over the next two to three years." JP Morgan maintains its Overweight rating and $84 price target. Rockwell Collins closed Friday at $60.51.