Morgan Stanley Says Johnson Controls Is Falling Between The Cracks

According to Morgan Stanley, Johnson Controls JCI is its top supplier pick and one of the most powerful secular stories in the group, yet consensus appears to be conservative when modeling the growth potential. Morgan Stanley said that JCI's secular opportunities in green buildings, auto content growth and hybrid batteries have been well telegraphed but consensus est of 11.5% revenue CAGR and 180 bp margin growth by 2013 do not fully reflect this upside potential. “Our EPS est. are 15% above cons. on revenue CAGR of 14% and 230 bp margin gain.” Johnson Controls closed yesterday at $38.23.