Market Overview

Univar Spikes 6% Following Goldman's Buy Upgrade


Goldman Sachs' Robert Koort upgraded Univar Inc (NYSE: UNVR) from Neutral to Buy, ripping the stock price ups by 6 percent. Koort raised the price target to $22 from $18.

Koort felt Univar is "primed to benefit from a rejuvenated growth story as oil&gas headwinds subside." Coupled with board member Stephen Newlin taking over as CEO, this will cause "UNVR's narrative to shift positively to focus on strong cash flows, margin improvement potential, and attractive valuation" in comparison with primary peer Brennatag AG.

Univar showed strong results in Q1 when it beat EBITDA estimates by 15 percent and had "solid underlying volume growth (+2% globally excl. oil&gas)." Negative earnings outlook since Univar's IPO in June 2015 are expected to "reverse course," Koort noted. He views Newlin's track record at PolyOne Corporation (NYSE: POL), which saw "impressive earnings, margin and share price gains during his tenure," as the main catalyst for the upgrade.

In addition to internal changes, the "ongoing efforts to supplement the portfolio through higher-margin services and incremental acquisitions" are crucial to the changing sentiment around Univar and will allow the company to "narrow its valuation discount to Brenntag."

Shares traded recently at $18.79, 5.8 percent.

Latest Ratings for UNVR

Apr 2019DowngradesBuyHold
Dec 2018MaintainsOutperformOutperform
Sep 2018UpgradesHoldBuy

View More Analyst Ratings for UNVR
View the Latest Analyst Ratings

Posted-In: Goldman Sachs Robert KoortAnalyst Color Upgrades Price Target Analyst Ratings


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