Market Overview

Credit Suisse Downgrades B/E Aerospace Ahead Of Rockwell Collins Acquisition

Share:
Credit Suisse Downgrades B/E Aerospace Ahead Of Rockwell Collins Acquisition

Despite the increasing wide-body OE pressure in the medium term, Credit Suisse’s Robert Spingarn expressed optimism regarding the long-term business prospects for B/E Aerospace Inc (NASDAQ: BEAV). Spingarn added that the company is a good strategic fit for Rockwell Collins, Inc. (NYSE: COL).

Spingarn downgraded the rating on B/E Aerospace from Outperform to Neutral, while raising the price target from $58 to $62.

Strong Execution

“Execution has been solid and BEAV is nearing the conclusion of a product development cycle which should drive improved FCF conversion of ~100 percent next year and beyond,” the analyst mentioned.

Spingarn also sees the company as a solid proxy vehicle for long-term air travel, which is among the more attractive growth markets among Industrials.

Related Link: A Look At One Crazy M&A Weekend

B/E Aerospace recently addressed major issues associated with the OE cycle, with management noting that the expansion of the company’s installed fleet would begin to shift the mix from “60/40 OE/aftermarket” to the opposite through the next few years.

Positive Expectations

“We also agree with BEAV's (and COL's) assessment that retrofit activity is somewhat decoupled from the OE cycle, which could mitigate some of the impact should OE begin to deteriorate beyond the anticipated next 777 cut,” the analyst stated.

he analyst also pointed out that while the market appeared skeptical regarding the Rockwell Collins deals being completed, it was likely to be completed successfully.

Full ratings data available on Benzinga Pro.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!

Latest Ratings for BEAV

DateFirmActionFromTo
Nov 2016Deutsche BankDowngradesBuyHold
Oct 2016Vertical ResearchInitiates Coverage OnHold
Oct 2016Credit SuisseDowngradesOutperformNeutral

View More Analyst Ratings for BEAV
View the Latest Analyst Ratings

 

Related Articles (BEAV + COL)

View Comments and Join the Discussion!

Posted-In: Credit Suisse Robert SpingarnAnalyst Color Downgrades Price Target Travel Analyst Ratings General Best of Benzinga

Latest Ratings

StockFirmActionPT
MRVLKeyBancReinstates55.0
SANDTD SecuritiesUpgrades14.5
RGLDTD SecuritiesUpgrades
XELMorgan StanleyMaintains65.0
LUGTD SecuritiesUpgrades17.5
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com