UPDATE: Loop Capital Starts Colfax Corporation (CFX) at Hold

Loop Capital analyst Chris Dankert initiates coverage on Colfax Corporation (NYSE: CFX) with a Hold rating and a price target of $45.00.

The analyst comments "(SOTP 13x EV/EBITDA for ESAB, 12.5x Enovis, or 18x our CY22 EPS forecast of $2.50). Colfax is a story of frequent portfolio realignment, culminating with the impending split into separate FabTech/ ESAB and MedTech/ Enovis businesses through a tax-free spin during 1Q22. For ESAB, the separation should support accelerated growth and the potential for a stronger multiple reflecting the impressive improvement the business has made over the past decade. Meanwhile, Enovis will continue to build scale and drive accelerated growth by emphasizing focus on the extremities market within the reconstructive business. Continued accretive M&A and the potential for a take-out over time also present positive drivers for Enovis, which is a sub-scale player today, but growing rapidly. The separation should allow the intrinsic value of each business to be realized. Higher leverage and international exposure present near-term headwinds for ESAB, while lack of scale and heavy investment costs present challenges for Enovis, but we like the long-term set-up."

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

Shares of Colfax Corporation closed at $46.97 yesterday.

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