Search Coverage List, Models & Reports
Search Results1-10 out of 553
This week brings 8 stocks from our coverage universe to the stage. We reviewed some of the early reads last Friday (07/19/19), but the bottom line has been slightly weaker sales and margin pressure. UTX is the only stock reporting in this class, where we are tactically positive. We see less risk to estimates for ITW and FTV vs. GWW, MMM and ROK where we are tactically cautious.
LII’s miss was far more significant than we had expected with $3.74 EPS significantly below $4.02 WRe and $4.14 consensus; note that street estimates have been falling over the past month to reflect the cooler and wetter weather called out by management. We mark this as a 18c core miss - rising to 22c when we adjust for the $2m of favorable insurance minus tornado impact - driven by weaker Residential volumes and Refrigeration conversion, partially offset by upside at Commercial (where ironically, we had more concern). See Ex 1-3 for more detail.
Honeywell has sailed through what will clearly be another choppy quarter for Industrials. While growth will decelerate into 2H19 on tougher comps, and there are some legitimate concerns that short cycle weakness could spread from SPS, the reality is that we do not see a likely scenario where HON will not deliver at the upper end of its EPS guidance range. We raise our YE19 price target from $179 to $181. Reiterate OP.
It feels like the market is rewarding industrials more for margin execution this quarter, with less emphasis on demand dynamics, per se. Generally, the market is selling reports, but we continue to like UTX, IR, EMR, GE and JCI as tactical longs.
Our FY19e is broadly undisturbed, despite a 2c core beat in the quarter. The positive stock performance today (7/18/19) was largely driven by continued execution on productivity initiatives, which gives us confidence in margin sustainability through 2H19. We leave our $105 PT unchanged and reiterate OP rating.
Headline EPS of $1.56 edges Street/WRe at $1.53/1.52 - we mark this as a 2c core beat, as a modest segment miss - driven by downside in the ES segment –was offset by lower corporate. Core sales missed by 2ppts vs. WRe, with organic sales growth of 2.9% on sharp deterioration at ES (1.7%) and another step down at Refrigeration (-3%) despite easy comps. Free cash of $155m is in line with WRe, but conversion remains weak at 68%. See Exhibit 1-3 for more details.
- 1 of 56
- next →