Jefferies Cuts Price Target on Solutia (SOA) Following Updated 2012 Guidance
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Price: $27.82 --0%
Rating Summary:
0 Buy, 5 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 4 | Down: 6 | New: 18
Rating Summary:
0 Buy, 5 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 4 | Down: 6 | New: 18
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Jefferies is reiterating its Buy rating on shares of Solutia (NYSE: SOA), but is lowering its price target from $26 to $22.
During the company's investor day, management announced its forecasting EPS of $2.00-$2.30 for fiscal 2012 on 2-10 percent volume growth. The company's volume growth outlook calls for 5.2 percent at its mid-point.
Management reaffirmed its outlook of global PV installation growth of 20 percent CAGR through 2015. EBITDA margins are predicted to decline to roughly 20 percent from today's 30 percent due to pricing pressure.
An analyst at Jefferies comments, "Nextgeneration products and revitalized processes are expected to drive 25% of earnings growth through 2015, adding an estimated $70m to EBITDA. Growth in Asia should add another $40-$80m. And $495m in strategic capex spend should add $115m to EBITDA by 2015. All together, these three drivers should account for more than 85% of earnings growth by 2015. Additional levers could include base volume growth, net price, and productivity"
For an analyst ratings summary and ratings history on Solutia click here. For more ratings news on Solutia click here.
Shares of Solutia closed at $15.26 yesterday.
During the company's investor day, management announced its forecasting EPS of $2.00-$2.30 for fiscal 2012 on 2-10 percent volume growth. The company's volume growth outlook calls for 5.2 percent at its mid-point.
Management reaffirmed its outlook of global PV installation growth of 20 percent CAGR through 2015. EBITDA margins are predicted to decline to roughly 20 percent from today's 30 percent due to pricing pressure.
An analyst at Jefferies comments, "Nextgeneration products and revitalized processes are expected to drive 25% of earnings growth through 2015, adding an estimated $70m to EBITDA. Growth in Asia should add another $40-$80m. And $495m in strategic capex spend should add $115m to EBITDA by 2015. All together, these three drivers should account for more than 85% of earnings growth by 2015. Additional levers could include base volume growth, net price, and productivity"
For an analyst ratings summary and ratings history on Solutia click here. For more ratings news on Solutia click here.
Shares of Solutia closed at $15.26 yesterday.
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