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Wells Fargo Initiates Coverage On 4 Electric Equipment Stocks With Mixed Ratings

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·2 min read
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  • Wells Fargo analyst Joseph O'Dea initiated coverage on electrical equipment companies Emerson Electric, Eaton, Hubbell, and Rockwell Automation.

  • Emerson Electric Co. (NYSE: EMR) was initiated with an Equal Weight rating and a price target of , implying an upside of 1.64%.

  • O'Dea views the company's 2023 EPS targets as achievable despite a challenging environment in some of the company's end markets. He adds that while relative valuation is "attractive," he does not see a clear catalyst to unlock the valuation discount.

  • Eaton Corporation PLC (NYSE: ETN) was initiated with an Equal Weight rating and a price target of 9 price target, implying an upside of 3.23%.

  • O'Dea mentions the company has been "meaningfully upgraded" through the management's "transformational efforts," reducing its cyclical exposure and driving margin expansion.

  • He adds, while he has "reservations" about discounting the management's full earnings growth target of 11-13% CAGR through 2025, consensus estimates through FY23 do not look "stretched."

  • Rockwell Automation Inc (NYSE: ROK) was initiated with an Underweight rating and a price target of 6, implying a downside of 16.02%.

  • O'Dea mentions, Rockwell is a "high-quality operator with a solid history of execution and outgrowth" versus industrial production, but the stock's relative valuation "looks rich versus history."

  • He adds that the company's "early-cycle favor has run its course" and that he does not see a clear case for meaningful positive earnings revisions in 2022 and 2023.

  • Hubbell Inc (NYSE: HUBB) was initiated with an Equal Weight rating and a price target of 2, implying an upside of 4.48%.

  • The analyst said the company's estimates look "well-calibrated," though he is watching for consistent bolt-ons. O'Dea added that he currently sees the risk/reward on shares as "balanced."

  • Price Action: EMR shares are trading lower by 0.28% at $97.07, ROK lower by 1.00% at $301.80 during the premarket session on Friday. ETN closed higher by 1.46% at $153.92, and HUBB lower by 0.06% at $183.87 on Thursday.

Latest Ratings for EMR

Oct 2021

Wells Fargo

Initiates Coverage On

Equal-Weight

Oct 2021

Morgan Stanley

Maintains

Equal-Weight

Aug 2021

Morgan Stanley

Maintains

Equal-Weight

View More Analyst Ratings for EMR
View the Latest Analyst Ratings

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