Applied Industrial Technologies (AIT) PT Raised to $215 at KeyBanc
KeyBanc analyst Steve Barger raised the price target on Applied Industrial Technologies (NYSE: AIT) to $215.00 (from $210.00) while maintaining a Overweight rating.
The analyst commented, "Following AIT's F4Q24 earnings call, we are adjusting estimates, raising our PT to $215 from $210, and reiterating our OW rating. AIT shares out-performed following its F4Q EPS beat and newly introduced guide below consensus. Although we view the new FY25 guide as nominally disappointing, we think there could be modest potential upside to the new outlook given mgmt's. conservatism on full-year market growth into easier comparisons, solid margin execution in F4Q despite weaker organic sales, and the Company's history of conservative initial EPS guidance in recent years. While we acknowledge that NT visibility surrounding an eventual inflection in Industrial demand remains limited, we think AIT's expectations for market declines of LSD-MSD in FY25 could be too conservative in the face of much easier comparisons starting in F2Q25. When we think about that in the context of AIT's under-levered balance sheet and its lean toward accretive M&A, we think shares remain highly attractive. Specifically, we think incremental M&A could support earnings power of ~$11/share through FY25, while our bull-case scenarios see EPS in excess of $12/share."