Oshkosh Set To Benefit From Slew Of Multi-Year Tailwinds, Analyst Says

Raymond James analyst Felix Boeschen reiterated an Outperform rating on the shares of Oshkosh Corp OSK and lowered the price target from $110 to $95.
The analyst thinks OSK's Vocational EPS power into FY24/25 is substantially under-appreciated on the back of municipal-led volume tailwinds coupled with an array of profit improvement levers like price increases flowing through the P&L, input cost pressures/manufacturing inefficiencies easing, capacity expansion tailwinds and new product launches.
The analyst believes that most of OSK's incremental EPS growth is likely to come in Vocational. The analyst sees it as the business with the greatest demand resiliency in the company's portfolio in the wake of macro uncertainty.
However, the analyst acknowledges that mounting macro headwinds could weigh on OSK's pro-cyclical Access segment.
The analyst views Oshkosh as a high-quality specialty vehicle manufacturer set to benefit from a slew of multi-year tailwinds, including an AWP replacement cycle, a municipal order recovery, the entrance into the last mile delivery vehicle space, and electrification of commercial vehicles.
In the near term, the analyst sees, in particular, OSK's Vocational business as a critical investment case.
Price Action: OSK shares are trading higher by 1.29% at $79.40 on the last check Wednesday.

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