UPDATE: Pentair (PNR) Reiterated Underweight but PT Raised to $64 at Morgan Stanley
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Morgan Stanley analyst Joshua Pokrzywinski raised the price target on Pentair (NYSE: PNR) to $64.00 (from $63.00) after results were strong on the back of strong consumer demand but with a bottlenecked industry and inventories starting to slowly come into alignment, definitively calling for a typical growth rate in any residential-facing industry in 2022 is difficult to us and PNR's 50% growth in an 80% replacement market in pools has plenty of mix and discretionary components that can
moderate in the medium term.
The analyst reiterated an Underweight rating, stating "We do fully believe that some of the mix
improvement favoring higher efficiency pumps, salt chlorination, automation, heaters, etc. will sustain above pre-COVID rates, but completely upending consumer behavior and seamlessly growing on top of that assumes no digestion or at the very least no pull-forward of discretionary purchases where there was no breakage (e.g., a pool pad upgrade for heaters or automation). We don't expect a sustained industry down-cycle, but risk/reward continues to look difficult as investors look beyond the immediacy of a tight market."
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