KeyBanc Starts Manitowoc Foodservice (MFS) at Overweight

KeyBanc initiated coverage on Manitowoc Foodservice (NYSE: MFS) with an Overweight rating and a price target of $16. Analyst James Picariello expects margin expansion and revenue growth.

"Following the Company’s spinout from MTW, we see a compelling combination of margin expansion, resilient MSD revenue growth and ample capacity for debt reduction to deliver notable earnings and multiple expansion," said James Picariello.

The analyst added, "Since joining in late-July, the new MFS management team has a strong early track record around profitability improvement, which we immediately saw in 2H15 and are encouraged by given the targeted +300 bps YOY operating margin expansion guided for 2016. This will still leave MFS roughly 700 bps below direct peers, underscoring the immense opportunity. Over the next two years, initial right-sizing ($40M) and simplification ($60M) savings are slated to deliver a combined +500 bps, with the likelihood of more to come."

For an analyst ratings summary and ratings history on Manitowoc Foodservice click here. For more ratings news on Manitowoc Foodservice click here.

Shares of Manitowoc Foodservice closed at $13.36 yesterday.

You May Also Be Interested In

• Goldman Sachs Starts Lovisa Holdings Ltd (LOV:AU) at Neutral
• H.C. Wainwright Starts Seres Therapeutics (MCRB) at Buy
• Citrini flags overheating concerns as leverage, chip rally weigh on KOSPI