Wells Fargo Raises Price Valuation on Kronos (KRO), Raising Prices on Higher Input Costs

Wells Fargo is reiterating its Outperform rating on shares of Kronos (NYSE: KRO) and is raising its price valuation range from $34.50-$36 to $37-$40.

The firm is adjusting its estimates to go inline with industry and business news-flow since the company reported its Q1 earnings on May 4. It is lowering its Q3 EPS estimate from $0.90 to $0.81, its Q4 from $0.83 to $0.78, and its FY11 from $3.10 to $2.95. Wells is also raising its FY12 from $4.11 to $4.27.

The adjustments to its estimates are reflects KRO's Q3 selling price announcements, and higher input cost expectations.

The firm believes that the company will be able to raise prices to offset input cost inflation given continued tight global industry supply/demand characteristics.

Since the beginning of May, 4 of the 5 major TiO2 producers have raised selling
prices by $0.19. Kronos plans to increase its price by $0.16 per pound. While Wells Fargo does not anticipate that KRO will raise its prices anymore in 2011, it does predict a $0.07 increase quarterly in 2012.

For more ratings news on Kronos click here and for the rating history of Kronos click here.

Shares of Kronos closed at $28.65 yesterday.

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