Thomas & Betts stock advances after Oppenheimer analyst upgrades shares to ‘Outperform’By AP
Thursday, October 7, 2010
Thomas & Betts shares rise after analyst upgrade
NEW YORK — Shares of Thomas & Betts Corp. rose on Thursday after an analyst upgraded the maker of electrical power components, saying the market for its products is improving.
THE SPARK: Oppenheimer analyst Christopher Glynn upgraded Thomas & Betts to “Outperform” from “Perform” in a note to investors on Thursday. He also raised the company’s price target to $50 from $46.
THE ANALYSIS: Glynn raised his earnings outlook for the company for this year and next, saying the company’s guidance looks “increasingly conservative.”
The company’s electrical business is improving as utility spending increases, he said, though its steel structures business “remains uncertain in the near term.”
He added that the company has “plentiful liquidity,” noting its $389 million in cash on hand as of June. It also has an attractive stock buyback program, he said. Buyback programs reduce the number of outstanding shares and can raise the price of remaining shares.
THE BIG PICTURE: The Memphis-based company had suffered from a drop-off in sales as the companies it serves cut back on spending in the economic downturn. But in July it reported signs of recovery, saying second-quarter net income jumped 48 percent.
STOCK ACTION: Shares rose $1.01, or 2.4 percent, to $43.06 in midday trading. The stock has ranged between $29.88 and $44.05 in morning trading.
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