Wells Fargo Starts RPM International (RPM) at Outperform

Wells Fargo initiated coverage on RPM International (NYSE: RPM) with an Outperform rating and a price target of $46-$48.

Analyst Frank J. Mitsch said, "We believe there is significant upside potential in RPM’s share price given the company’s strong correlation with what we view as recovering housing/remodeling activity in the United States. Inorganic growth via RPM’s differentiated M&A strategy is also a major driver."

"In terms of valuation, we believe RPM should be assessed as a blend of such consumer coatings companies as PPG and SHW, and industrial coatings/sealants producers like Sika and W.R. Grace. Trading at slightly less than 17x on F2015E earnings, RPM shares are more than two full turns below the weighted peer average, despite less earnings volatility and raising the dividend 40 years in a row. We introduce our FY2014E EPS at $2.15 and FY2015E at $2.45," he added.

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

Shares of RPM International closed at $40.88 yesterday.

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