Frequency Electronics, Inc. (FEIM) PT Raised to $34 at Freedom Broker

Freedom Broker analyst Sergey Glinyanov raised the price target on Frequency Electronics, Inc. (NASDAQ: FEIM) to $34.00 (from $26.00) while maintaining a Buy rating.

The analyst comments "We’re raising our view on FEIM because we’re switching from DCF to a comps-based approach, and the market has started to notice the stock is undervalued. FEIM’s current LTM P/E is 21.8x. Using the average effective tax rate for profitable defense peers (16.5%), the LTM P/E comes out to 25.5x. On the same basis, the NTM P/E points to a $34 target price. Our model assumes an even lower effective tax rate thanks to deferred tax assets and OBBBA. When results are decent, FEIM’s P/E tends to run above the S&P 1500 Aerospace & Defense benchmark (meaning >1x), suggesting more upside as earnings stabilize. We increase our target price to $34 per share and assign a “Buy” rating."

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