On Thursday, Jefferies resumed coverage on Ingersoll-Rand, listed on the New York Stock Exchange (NYSE:IR), issuing a Buy rating and setting a price target of $110.00. The firm's decision follows Ingersoll-Rand's completion of the ILC Dover (NYSE:DOV) acquisition, which is anticipated to boost the company’s revenue and EBITDA.
The updated coverage reflects revised 2024 estimates, taking into account the expected financial impact from the recent ILC Dover transaction. Jefferies has adjusted their earnings per share (EPS) estimate for Ingersoll-Rand, projecting an annual increase of $0.10 to $0.15 through 2026. These projections are based on the anticipated growth in earnings following the acquisition and the company's intra-quarter debt activities.
Jefferies highlighted that their positive outlook is supported by the expected increase in revenues and EBITDA due to the ILC Dover purchase. The firm also acknowledged the debt management efforts by Ingersoll-Rand during the quarter, which contributed to the revised estimates.
It is important to note that the updated estimates do not include the impact of three additional acquisitions completed by Ingersoll-Rand in June. The outcomes of these recent acquisitions have yet to be factored into the financial forecasts.
Ingersoll-Rand’s strategic moves, including the ILC Dover acquisition and the recent additional acquisitions, demonstrate the company's active pursuit of growth and expansion in its market segment. Jefferies' coverage update and the new price target reflect a positive outlook on the company's future financial performance.
In other recent news, Ingersoll-Rand has been the subject of notable developments. The company reported a strong start to 2024, with a robust first-quarter performance and an upward revision to its full-year guidance. The adjusted EBITDA saw a 15% year-over-year increase, and the firm generated $99 million in free cash flow. Furthermore, Ingersoll-Rand announced the completion of two strategic acquisitions, Ethafilter and Controlled Fluidics, and the pending acquisition of ILC Dover, indicating a strategic move towards significant inorganic growth.
Baird, an independent firm, has affirmed its positive stance on Ingersoll-Rand, raising the price target to $109 from $107 while maintaining an Outperform rating. The firm has recognized Ingersoll-Rand's robust performance and attributes a positive outlook to the company's healthy backlog, increased project activity, and a favorable book-to-bill ratio. Additionally, Baird noted that Ingersoll-Rand's strategic financial management could act as an additional catalyst, with potential incremental deals likely to occur.
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