Wedbush Cuts Price Target on ITT Corp. (ITT), Calculates New Market Multiples
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Price: $219.40 +1.25%
Rating Summary:
16 Buy, 9 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
16 Buy, 9 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Wedbush is reiterating its Outperform rating on shares of ITT Corp. (NYSE: ITT) while lowering its price target from $68 to $60.
The firm notes that due to a economic slowdown and persistent concerns over defense budgets, they are lowering their multiple on the ITT. Wedbush notes that no signs point weakness in the company's operations during this time, while there are also no signs of an upside.
To go inline with current market conditions, Wedbush is raising its Q3 EPS estimate by $0.01 to $1.14 and is lowering its FY11 estimate by $0.02 to $4.81. The company guidance has a range of $4.70-$4.82 for the fiscal year.
An analyst at Wedbush comments, "In valuing these shares, we incorporate a sum-of-the-parts analysis and our DCF model. Given ITT’s consistent performance, free cash flow generation, and positive growth outlook, we believe that ITT stock should trade at least at the peer group multiples or higher, and have consequently placed a multiple of 5.5X EBITDA for the defense & information solutions business, and 9.0x for the New Water and 9.0 for the New ITT."
For more ratings news on ITT Corp. click here and for the rating history of ITT Corp. click here.
Shares of ITT Corp. closed at $40.48 yesterday.
The firm notes that due to a economic slowdown and persistent concerns over defense budgets, they are lowering their multiple on the ITT. Wedbush notes that no signs point weakness in the company's operations during this time, while there are also no signs of an upside.
To go inline with current market conditions, Wedbush is raising its Q3 EPS estimate by $0.01 to $1.14 and is lowering its FY11 estimate by $0.02 to $4.81. The company guidance has a range of $4.70-$4.82 for the fiscal year.
An analyst at Wedbush comments, "In valuing these shares, we incorporate a sum-of-the-parts analysis and our DCF model. Given ITT’s consistent performance, free cash flow generation, and positive growth outlook, we believe that ITT stock should trade at least at the peer group multiples or higher, and have consequently placed a multiple of 5.5X EBITDA for the defense & information solutions business, and 9.0x for the New Water and 9.0 for the New ITT."
For more ratings news on ITT Corp. click here and for the rating history of ITT Corp. click here.
Shares of ITT Corp. closed at $40.48 yesterday.
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