UPDATE: Goldman Sachs Initiates Coverage on A.O. Smith Corporation with Neutral Rating, $39 PT on Near-Term Headwinds

In a report published Monday, Goldman Sachs analyst Samuel H. Eisner initiated coverage on A.O. Smith Corporation AOS with a Neutral rating and $39.00 price target. In the report, Goldman Sachs noted, “We initiate coverage of AOS with a Neutral rating and a $39, 12-month price target. We believe the shares are poised to benefit from a continued recovery in the NA residential construction market and long-term household formation in China. That said, we believe near-term headwinds to China (25% of total revenue) and macroeconomic factors limit multiple expansion and revenue growth which keep us on the sidelines.” A.O. Smith Corporation closed on Friday at $36.28.