J.P Morgan Comments On TRW Automotive; Raises PT

According to J.P Morgan, TRW Automotive TRW seems to be entering a critical transition phase from which it thinks patient investors will be handsomely rewarded even if 2011 earnings momentum is deliberately moderated to fund tangible growth-related investment costs. A supplier long respected by value investors for aggressive cost containment and prudent balance sheet management is seeming more and more like a hidden growth story. J.P Morgan's revised estimates are conservative on revenue outperformance relative to industry production but also on margins. JPM revises its PT from $56 to $74, applying an 11x P/E multiple to its 2012e EPS of $6.75. Yet JPM sees a reasonable upside case to $8-9 of EPS or a ~$100 potential share price within 2-3 years assuming a low-teens P/E. TRW closed Thursday at $58.82