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AMEC Foster Wheeler Upgraded At Morgan Stanley Following Executive Change

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Morgan Stanley upgraded AMEC Foster Wheeler plc American Depositary Shares (NYSE: AMFW) to Overweight on potential restructuring benefits to be announced by new CEO.

"The new savings cost plan, likely to be announced at the Strategy Update on Nov15, should offer more than enough scope to offset the loss of ~£80m EBITA associated with £500m of asset disposals," analyst Robert Pulleyn wrote in a note.

The analyst expects £100 million of further annualized savings starting from the first half of 2017 with full impact in 2019.

"While we lower 2017e EPS by 14% to capture the dilution from disposals before cost savings are realised, we increase 2018e EPS by 9% and 2019/20e EPS by ~15% as cost savings kick in," Pulleyn continued.

Pulleyn expects the stock to re-rate as the cost savings story develops and the cycle continues to improve.

ADRs of AMEC Foster Wheeler closed Thursday's regular trading session at $7.02.

Latest Ratings for AMFW

DateFirmActionFromTo
Mar 2017Raymond JamesUpgradesMarket PerformOutperform
Mar 2017CitigroupUpgradesNeutralBuy
Nov 2016MacquarieUpgradesUnderperformNeutral

View More Analyst Ratings for AMFW
View the Latest Analyst Ratings

Posted-In: Morgan Stanley Robert PulleynAnalyst Color Upgrades Price Target Analyst Ratings

 

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