BofA Securities analyst Andrew Obin upgraded Vontier Corp VNT to Buy from Neutral at an increased price target of $40 (from $37).
The analyst sees more room to run for the company and forecasts all-in organic revenue growth and margin expansion in 2024 as U.S. fuel dispenser headwinds fade.
Obin expects 4% organic revenue CAGR and 170bps cumulative adjusted operating margin expansion to drive a 10% adj. EPS CAGR (FY23-FY26).
The analyst's FY24 estimates now exclude the completed Coats divestiture and despite this, their FY24E adj. EPS is higher at $3.14 (vs. $3.09 consensus) and FY25 adj. EPS is $0.16 higher at $3.51 (+12% Y/Y).
The analyst also expects contract wins for the iNFX payments platform to add to multi-year visibility and organic FCF generation (BofA FY24 $468 million) to be led by proceeds from the Coats divestiture.
Price Action: VNT shares are trading higher by 2.64% at $34.45 on the last check Thursday.
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