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Atlas Copco share price target raised on Q1 results

EditorNatashya Angelica
Published 04/25/2024, 12:07 PM

On Thursday, RBC Capital adjusted its price target on shares of Atlas (NYSE:ATCO) Copco AB (ATCOA:SS) (OTC: ATLKY), a leading industrial company, increasing it to SEK150.00 from SEK135.00. Despite this change, the firm maintained its Underperform rating on the stock.

The revision follows Atlas Copco's recent report of its first-quarter results and management's outlook for the upcoming quarters. RBC Capital's analyst highlighted adjustments to their forecasts, particularly for the fiscal year 2025, which led to the updated price target. The new target is based on a Discounted Cash Flow (DCF) and Sum of the Parts (SoTP) analysis.

Atlas Copco's stock has been trading at a significant premium compared to its European capital goods peers, currently at 48%. The RBC Capital analyst believes that a 20% trading premium would more accurately reflect the company's expected low-leverage earnings per share (EPS) growth of 7-8% per annum.

The Underperform rating suggests that RBC Capital anticipates Atlas Copco's stock performance may lag behind the general market or its industry sector in the near future. This rating is given even though the firm acknowledges the company's solid financial performance and future growth prospects.

Investors and market watchers will likely monitor Atlas Copco's share performance in light of this updated guidance from RBC Capital, as well as the company's strategic initiatives that may influence its future earnings trajectory.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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