Bank of America Merrill Lynch Reiterates Buy On Allegheny Technologies

Bank of America Merrill Lynch is out with a research report on Allegheny Technologies ATI and is reiterating its Buy rating and $75 price target on shares. In a note to investors, Bank of America Merrill Lynch writes, "We cut 2011e EPS to $2.55 vs $3.00 due to a weaker stainless steel outlook and further Ladish acquisition drag into Q3. Our new 2012-13e EPS of $4.75 and $6.30 compare to consensus at $4.79 and $5.63. Mgmt upped revenue guidance to $5.4-5.5B vs a prior $4.7-4.9B ex Ladish and 2011 segment EBIT mgns to 13-14% vs 15%. Aside from Ladish costs and inventory accounting, mgmt was upbeat on its higher-margin HPM segment and cited solid aerospace demand, including new alloys and fastener stock business. Oil/gas and chemical processing were strongest of end mkts, up 53% y/y in H1. Yet falling nickel and demand hurt commodity stainless mgns, albeit August was improved from July." Shares of ATI lost $3.19 yesterday to close at $60.73.