UPDATE: Citigroup Reiterates Neutral Rating, Raises PT on Federal Signal Corporation

In a report published Monday, Citigroup reiterated its Neutral rating on Federal Signal Corporation (NYSE: FSS), and slightly raised its price target from $6.00 to $7.00.

Citigroup noted, “Federal Signal has a poor ten-year and five-year operating track record, though the portfolio transformation under CEO Dennis Martin appears to be driving some improvements. The company remains near the bottom of the MI-EE sector average on key metrics such as fiveyear EBIT margins of 4.7% vs the 13% sector average, inconsistent free cash flow generation, and a decline in revenue over the past ten years. More recent metrics are improving with the 1H12 operating margin up 330 bps Y/Y to 5.5% and management reiterating low double-digit segment margin targets.”

Federal Signal Corporation closed on Friday at $6.52.