Nomura Securities Maintains a 'Buy' on Dover Corp. (DOV); Implied Energy Multiple Too Low
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Price: $171.44 --0%
Rating Summary:
15 Buy, 12 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 10 | Down: 8 | New: 5
Rating Summary:
15 Buy, 12 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 10 | Down: 8 | New: 5
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Nomura Securities maintains a 'Buy' on Dover Corp. (NYSE: DOV) price target of $78.00.
Analyst, Shannon O'Callaghan, said, "Implied energy multiple too low for DOV; we see 16% upside today on a peer multiple. Dover is now the cheapest stock in our sector on 2013 EPS, driven by a lateral read off recent weakness in energy service stocks. We estimate the market is currently pricing in around an 8.5x forward P/E on Dover’s Energy business, close to the multiple on Baker Hughes, which just negatively pre-announced 1Q due to weak pressure pumping related to natural gas. But Dover doesn’t do any pressure pumping and is actually benefiting from the mix shift away from natural gas towards oil/liquids. A closer Energy peer group of Robbins & Myers (NYSE: RBN), Lufkin Industries (NYSE: LUFK), National Oilwell Varco (NYSE: NOV), and Weatherford International (NYSE: WFT) is trading at an average of ~14x. We estimate that applying that ~14x peer multiple to Dover’s Energy business vs. the current implied 8.5x would put Dover shares at $71 right now, 16% higher than the current price."
For an analyst ratings summary and ratings history on Dover Corp. click here. For more ratings news on Dover Corp. click here.
Shares of Dover Corp. closed at $61.63 yesterday.
Analyst, Shannon O'Callaghan, said, "Implied energy multiple too low for DOV; we see 16% upside today on a peer multiple. Dover is now the cheapest stock in our sector on 2013 EPS, driven by a lateral read off recent weakness in energy service stocks. We estimate the market is currently pricing in around an 8.5x forward P/E on Dover’s Energy business, close to the multiple on Baker Hughes, which just negatively pre-announced 1Q due to weak pressure pumping related to natural gas. But Dover doesn’t do any pressure pumping and is actually benefiting from the mix shift away from natural gas towards oil/liquids. A closer Energy peer group of Robbins & Myers (NYSE: RBN), Lufkin Industries (NYSE: LUFK), National Oilwell Varco (NYSE: NOV), and Weatherford International (NYSE: WFT) is trading at an average of ~14x. We estimate that applying that ~14x peer multiple to Dover’s Energy business vs. the current implied 8.5x would put Dover shares at $71 right now, 16% higher than the current price."
For an analyst ratings summary and ratings history on Dover Corp. click here. For more ratings news on Dover Corp. click here.
Shares of Dover Corp. closed at $61.63 yesterday.
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