UBS Upgrades Pentair (PNR) to Buy

UBS upgraded Pentair (NYSE: PNR) from Neutral to Buy with a price target of $70.00 (from $48.00).

Analyst Shannon O'Callaghan commented, "The single biggest problem for PNR shares in our view has been the negative trajectory and inconsistency of V&C margins which, combined with end market pressure, has driven successive downward EPS revisions. We now think V&Cs margins have bottomed in 1Q16 as elimination of $25M of higher 1H inventory costs and cost savings on 2H volumes position V&C for margin recovery. We think important changes to the business to improve processes and the reliability of forecasting are taking hold. Market conditions remain difficult for V&C, orders are still declining, and we expect sales to decline y/y through 2016 as well, but we think the worst for margins is over and have greater confidence in management's ability to deliver on V&C guidance."

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

Shares of Pentair closed at $58.30 yesterday.

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