Analyst Michael Sison of Wells Fargo maintained a Hold rating on Axalta Coating Systems (AXTA – Research Report), with a price target of $33.00.
Geoff Meacham has given his Hold rating due to a combination of factors that impact Axalta Coating Systems’ market position and financial outlook. While the company’s full-year 2024 guidance shows healthy EBITDA growth, Meacham believes investors may remain cautious until there are clear signals of further growth potential that could lead to a revaluation of the company’s stock. Despite a raised EPS estimate for the first quarter of 2024 and the full year, driven by lower costs and modest sales growth, the outlook does not sufficiently indicate a decisive upward trajectory that would support a more aggressive rating.
The report also points to stable Refinish sales with potential upsides, yet this is counterbalanced by the expected stagnation in global light vehicle production and a slowdown in North American Commercial Vehicle production, which could dampen the Mobility Coatings sales growth. Furthermore, the persistent weakness in the Industrial Coatings segment, particularly within the North American construction market, adds to the cautious stance. Meacham’s valuation, maintaining a 12-month price target, reflects a balanced risk/reward scenario in light of these market and operational challenges, leading to the conclusion that a Hold rating is justified for Axalta Coating Systems at this juncture.
AXTA’s price has also changed slightly for the past six months – from $29.130 to $31.050, which is a 6.59% increase.
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Axalta Coating Systems (AXTA) Company Description:
Axalta Coating Systems Ltd. engages in the manufacture, marketing, and distribution of coatings systems. It operates through the Performance Coatings and Transportation Coatings business segments. The Performance Coatings segment provides liquid and powder coatings solutions to a fragmented and local customer base. The Transportation Coatings segment offers advanced coatings technologies to original equipment manufacturers of light and commercial vehicles. The company was founded on 1866 and is headquartered in Philadelphia, PA.
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