Jefferies continues to list Covidien Ltd (NYSE: COV) with a Buy rating, but Jefferies raised their price target on the company from $48 to $52.
The firms reason for increasing the price target is, "We continue to believe that the company's expanding margin profile and portfolio synergies are not fully reflected in the current multiple. COV trades at forward P/Es ('10 and '11) of ~12.8x and ~12.0x relative to consensus, which we think is low. We continue to believe that at least an in-line multiple is warranted. Our new $52 PT reflects a 14.5x forward ('11) multiple relative to our upwardly revised $3.55 CY11 estimate."
Thanks for the input ,,,mister,,,it's nice to see a post that makes sense on this board. Personally I feel that a general rally in all healthcare stocks would be needed to accomplish that price. After all ,past performance in no indication of future returns. Definitely higher in near term with a watchful eye on the sector.