NEW YORK (AP) -- A KeyBanc analyst on Tuesday upgraded Stanley Black & Decker Inc. to "Buy" from "Hold," saying that the stock's price has room to grow and that the company's financial results have the potential to beat Wall Street predictions.
The upgrade comes ahead of the company's fourth-quarter results, set to be released before the market opens on Jan. 24.
Kenneth Zener, who also set a $96 price target for the stock, noted that the tool maker's stock fell about 11 percent during the fourth quarter, while shares of industrial companies overall rose 10 percent.
The drop came after Stanley cut its full-year profit forecast in October. Zener said that when that happened, confidence in the stock's ability to grow and thrive dropped for many investors.
"While time will be necessary for Stanley Black & Decker to regain both lost confidence and investors, we think it will occur in 2014, as sales growth and operating leverage (about 30 percent) are at normalized rates," Zener wrote in a note to investors.
Also on Tuesday, Janney Capital Markets analyst Liam Burke backed his "Buy" rating for the stock, saying that investors haven't fully taken into account the boost the company could get from its industrial business.
Stanley Black and Decker shares rose $1.78, or 2.2 percent, to $81.93 in afternoon trading. Its shares have risen almost 9 percent over the past year.