Oppenheimer Remains Bullish on Johnson Controls (JCI) Ahead of Analyst Day
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Oppenheimer reiterated an Outperform rating on Johnson Controls (NYSE: JCI), and raised the price target to $52.00 (from $48.00), ahead of the company's analyst day.
Analyst Noah Kaye commented, "Ahead of Monday's Analyst Day, we revisit the Power Solutions growth thesis: Can the segment achieve a 7-8% revenue CAGR and higher EBIT growth through FY20, as JCI envisioned last year? We publish a sensitivity analysis on page 3; depending on the trajectory of start-stop vehicle demand, we see +/- $5-6/share variation in fair value. We consider three key risks to the base-case scenario of a 7.5% revenue CAGR: (1) delays/rollbacks in fuel economy or emissions standards slow down startstop adoption; (2) EV demand accelerates more rapidly; and (3) global competition results in a significant decrease in JCI’s market share. We believe JCI can execute on its growth strategy despite these risks. We introduce our FY19-20 estimates and raise our PT to $52 (from $48)."
Shares of Johnson Controls closed at $45.45 yesterday.
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