UPDATE: JPMorgan Starts Columbus McKinnon (CMCO) at Overweight
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JPMorgan initiates coverage on Columbus McKinnon (NASDAQ: CMCO) with a Overweight rating and a price target of $64.00.
The analyst comments "CMCO is a market leader in lifting solutions, with a somewhat volatile past owing to strategic missteps that led to a lost decade+ of performance. With a regime shift in 2017 that followed the retirement of its long-time CEO, the company embarked on a new strategy (Blueprint for Growth), yielding benefits that are so far most noticeable in margin performance and portfolio mix (diluted exposure to legacy lifting). We believe additional improvement from this strategy will be realized over the next few years, including better organic growth, supported by sales that remain well below prior peaks as well as increased mix of faster growing assets (e.g., precision conveying), and an upside breakout in margins from historical trading ranges. We see this combination of below-trend sales with potential for structurally better organic growth and margins as attractive, in particular given the wider-than-normal valuation discount to the sector. As a result, we rate the stock Overweight."
Shares of Columbus McKinnon closed at $45.99 yesterday.
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