KeyBanc Raises Price Target on Ashland (ASH), Sees 45% Earnings Growth in 2012

November 16, 2011 11:45 AM EST
Get Alerts ASH Hot Sheet
Price: $109.77 --0%

Rating Summary:
    9 Buy, 6 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 6 | Down: 10 | New: 6
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KeyBanc is reiterating its Buy rating on shares of Ashland Inc. (NYSE: ASH) while increasing its price target from $65 to $70.

The firm notes they came away from the company's analyst day conference more confident. KeyBanc believes 2012 will be strong year for earnings growth despite slowing conditions in the global economy. The firm's current earnings forecast for FY12 is $5.25 per share, which represents a 45 percent growth.

Due to several divestitures and acquisitions, KeyBanc believes ASH's operating margins will remain around the 10 percent range and sees that Specialty Ingredients segment operating margins in the 17-18 percent range. Valvoline operating margins should also move back to the low teens from high single digit levels.

Looking ahead, management set a long-term goal for earnings of $9.50-$10.50 for FY14. The firm believes this growth is expected to come from factors under the company's control like cost savings, pricing, new products, and geographic expansion.

For an analyst ratings summary and ratings history on Ashland Inc. click here. For more ratings news on Ashland Inc. click here.

Shares of Ashland Inc. closed at $54.61 yesterday.

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