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BofA raises Snap-On stock price target to $275 from $240, keeps rating

EditorNatashya Angelica
Published 03/11/2024, 11:17 AM
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On Monday, BofA Securities updated its outlook on Snap-On (NYSE:SNA), a prominent manufacturer of tools, storage, and equipment for professional users in various sectors, including auto repair and dealerships. The firm raised the price target on the company's stock to $275 from the previous $240. Despite the increase in the price target, BofA Securities maintained an Underperform rating on the stock.

The adjustment follows a review of the fundamental drivers of Snap-On's business, particularly after noting a decline in organic tool sales in the fourth quarter. BofA Securities pointed out that the near-term macroeconomic trends, such as weak consumer sentiment and rising cost of living, coupled with less favorable conditions in the car parc, like lower values and slower growth in post-warranty vehicles, could impact the company's performance.

The firm acknowledged Snap-On's strong long-term growth prospects as an entrenched market leader. However, the current lack of near-term drivers for the stock led to the reiteration of the Underperform rating. The analyst suggested that the weaker growth prospects are already reflected in the stock's price, indicating a cautious stance on its near-term potential.

Snap-On's position in the market as a leading provider to professional users remains solid, but BofA Securities' outlook suggests that investors may need to temper their expectations for the company's stock performance in the immediate future.

The new stock price target of $275 represents a revised expectation for the stock's valuation, even as the analyst advises a conservative approach due to the current economic headwinds.

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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