Jefferies Says Prep for Downside in Machinery Stocks, Keep Powder Dry
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Rating Summary:
18 Buy, 21 Hold, 5 Sell
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Rating Summary:
18 Buy, 21 Hold, 5 Sell
Rating Trend: Down
Today's Overall Ratings:
Up: 0 | Down: 0 | New: 0
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As macro concerns continue to plague Europe, emerging markets , and the U.S., Jefferies analyst remain cautious on Machinery stocks and see another 5 percent in downside, despite a 10-15 percent declined in just the past few weeks.
"We see more downside than upside risk in 3Q machinery earnings, and despite modest expectations we still recommend a defensive short term stance," said analyst Stephen Volkmann.
"We are lowering many of our estimates for 2013 and 2014. We see earnings and forecast risk at Caterpillar Inc. (NYSE: CAT) Eaton Corporation (NYSE: ETN) and Kennametal Inc (NYSE: KMT), while AGCO Corporation (NYSE: AGCO) and Ingersoll-Rand (NYSE: IR) and Titan International Inc (NYSE: TWI) top our list of more defensive names," said Volkmann.
Longer term, he still sees significant pent up demand in most industrial end markets when macro concerns fade.
"We see more downside than upside risk in 3Q machinery earnings, and despite modest expectations we still recommend a defensive short term stance," said analyst Stephen Volkmann.
"We are lowering many of our estimates for 2013 and 2014. We see earnings and forecast risk at Caterpillar Inc. (NYSE: CAT) Eaton Corporation (NYSE: ETN) and Kennametal Inc (NYSE: KMT), while AGCO Corporation (NYSE: AGCO) and Ingersoll-Rand (NYSE: IR) and Titan International Inc (NYSE: TWI) top our list of more defensive names," said Volkmann.
Longer term, he still sees significant pent up demand in most industrial end markets when macro concerns fade.
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