TopBuild Upgraded To Buy At Benchmark; Price Target Raised To $260 At Keybanc

Benchmark analyst Reuben Garner upgraded TopBuild Corp BLD to Buy from Hold with a price target of $275, implying an upside of 22.7%.
The rating was updated after the company announced the acquisition of Distribution International from Advent in an all-cash transaction valued at about $1 billion.
Garner states the market may be "slow to digest," as the stock was up just over 1% on the day following the deal announcement; however, he would "take advantage of the disconnect" given he likes the deal.
Garner added the deal is expected to be accretive to EPS and cash-flow positive in year one, adds a market-leading position in a new $5B addressable market, and diversifies the company into a "secular growth opportunity that reduces cyclicality."
Additionally, Keybanc raised the price target to $260 (implying an upside of 16.05%) from $255 and maintained Overweight ratings on the shares.
Price Action: BLD shares closed higher by 1.70% at $223.73 on Thursday.

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