Stanley Black & Decker's Slow Recovery In Margins & Sales Triggers Price Target Cut By This Analyst

  • Credit Suisse analyst Dan Oppenheim lowered the price target for Stanley Black & Decker, Inc. SWK to $125 (an upside of 23.3%) from $165 while maintaining the Outperform rating on the shares.
  • The analyst states that his more cautious estimates and target reflect concern that a recovery in margins and sales will likely occur gradually over the course of 2023, with that partially offset by the company’s $2 billion global cost reduction program.
  • Oppenheim reduced the estimates for the company based on the near-term impact from slower sales and lower production to reduce inventory, the recently-completed sale of Security, and some benefit from the cost reduction program.
  • Also ReadStanley Black & Decker Shares Plunge On Q2 Miss, FY22 Guidance Cut
  • The analyst mentions that the risk includes challenges restoring sales growth, realizing cost savings, and executing on other initiatives. More stable product portfolio and achievement of supply chain savings will be key to outperformance.
  • Oppenheim believes that with the recent divestiture of Security and agreement to sell the Oil & Gas business, SWK will be able to focus on its core Tools & Outdoor and Industrial businesses.
  • RelatedStanley Black & Decker Divests Its Oil & Gas Business
  • Price Action: SWK shares are trading higher by 1.53% at $101.39 on the last check Monday.
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