Analysts Cut Johnson Controls Price Target Post Q1 Results

Analysts lowered the price target for Johnson Controls International PLC JCI after Q1 results.

• Deutsche Bank analyst Nicole DeBlase lowered the price target to $80 (an upside of 15%) from $84 and maintained a Hold rating on the shares.
• Mizuho analyst Brett Linzey reduced the price target to $88 (an upside of 26.6%) from $93 and kept a Buy rating on the shares post the fiscal Q1 results. 
• Linzey mentions Johnson Controls continues to make progress on the various commercial initiatives across the organization. The price target drop reflects the broader de-rating of the market and industrial complex.
• Credit Suisse analyst John Walsh lowered the price target to $86 (an upside of 23.7%) from $89 and maintained an Outperform rating on the shares.
• Recently, Johnson Controls reported first-quarter FY22 sales growth of 10% Y/Y to $5.86 billion, and +8% on an organic basis, beating the consensus of $5.12 billion.
• Adjusted EPS improved by 26% Y/Y to $0.54, beating the consensus of $0.47.
• Adjusted EBIT was $542 million, and adjusted EBIT margin was 9.2%, up 40 bps versus the prior year.
• For the quarter, cash provided by operating activities from continuing operations was $0.4 billion, and capital expenditures were $0.1 billion, resulting in free cash flow from continuing operations of $0.3 billion.
• The company repurchased ~7.2 million shares for $526 million during the quarter.
• 2Q22 Outlook: The company expects Organic revenue up high-single digits year-over-year; Adjusted segment EBITA margin expansion of 50 - 60 bps; and Adjusted EPS of $0.62 - $0.64 vs. consensus $0.56.
• FY22 Outlook reaffirmed: Organic revenue growth of 8% - 10% year-over-year; Adjusted segment EBITA margin expansion of 50 - 60 bps; and Adjusted EPS of $3.22 - $3.32 vs. consensus of $2.92.
• Price Action: JCI shares are trading lower by 3.94% at $69.47 on the last check Thursday.