Wells Fargo Upgrades Tenneco (TEN) to 'Outperform'; Sloppy Q4 Expected, But Upside Potential > Downside Risk

Wells Fargo upgrades Tenneco (NYSE: TEN) from Market Perform to Outperform price target range $37-$41 from $31-$35.

Wells analyst says, "We believe risk/reward is favorable at current levels. Investor sentiment is fairly negative and expectations are low heading into the Q4 release and OEM revenue (rev) update (scheduled for 2/2). We acknowledge there is risk to Q4 and the consensus 2012 EBITDA ($700MM) - we are at $~667MM. However, it appears to us investors have already braced for a sloppy Q4 and a recalibration of forecasts. Based on the current share price of ~$32, we see $3-4 downside risk and $8-9 upside potential. Recent comments from large machinery companies (Caterpillar (NYSE: CAT), etc.) suggest potential upside to offroad/on-road vehicle production should non-residential spending pick up."

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

Shares of Tenneco closed at $32.49 yesterday.

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