Deutsche Bank Has Hold Rating On Johnson Controls

Deutsche Bank has a Hold rating and a $44 price target on shares of Johnson Controls JCI. In a note to clients, Deutsche Bank writes, "Johnson Controls hosted an Analyst Meeting in which they provided a deep dive into the business outlook for their Power Solutions division (14.5% of 2011E sales; 33% of 2011 earnings). Overall, we thought that the company presented a relatively convincing case to support expectations of 10%-12% growth over the next 3-4 years. Part of this growth is expected to come from Emerging markets--JCI's China business alone could grow to 23 MM units by 2015 (30% of a 76 MM market), up from 4 MM in 2010. We estimate that this 19 MM units of growth could add ~$740 MM of top line growth, (compares with a $4.9 bn/125 MM unit base business for all of JCI Power Solutions in 2010). If spread evenly over 5 years, this opportunity alone could add 2%-3% annual growth for JCI's Power Solutions division. Perhaps even more significantly, JCI believes that it is on the cusp of very significant growth in its advanced lead acid battery technology, driven by a shift towards increased vehicle electrification." Shares of JCI gained 35 cents yesterday to close at $39.52, a gain of 0.89%.