There’s a lot to be optimistic about in the Conglomerates sector as 2 analysts just weighed in on Tower International (TOWR) and Energy Recovery (ERII) with bullish sentiments.
Tower International (TOWR)
B.Riley FBR analyst Christopher Van Horn reiterated a Buy rating on Tower International on July 12 and set a price target of $40. The company’s shares closed on Friday at $30.99.
Van Horn noted:
“We believe TOWR shares are worth roughly 5x 2020 adjusted EBITDA, which equates to our $40 PT.”
According to TipRanks.com, Horn is a 3-star analyst with an average return of 2.0% and a 49.2% success rate. Horn covers the Consumer Goods sector, focusing on stocks such as Standard Motor Products, Cooper Tire Rubber, and Dorman Products.
Currently, the analyst consensus on Tower International is a Moderate Buy with an average price target of $40.
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Energy Recovery (ERII)
In a report released today, Tom Curran from B.Riley FBR maintained a Buy rating on Energy Recovery, with a price target of $15. The company’s shares closed on Friday at $10.84, close to its 52-week high of $11.11.
“On 7/12, we hosted client meetings with CFO Josh Ballard and VP of IR Jim Siccardi. We came away with bolstered confidence in (1) the power and duration of the ongoing global upcycle in SWRO desal (seawater reverse osmosis desalination) infrastructure spending, whose indicators offer visibility into the 2020s as governments invest to close the world’s water 2030 water gap; (2) CEO Chris Gannon’s multi-faceted growth strategy for the Oil & Gas team’s progress with the VorTeq system, which should be ready to resume the Milestone #1 test before year end. We expect management to expound upon these reassurances on ERII’s 2Q call and will wait until then to revisit our model. But, we are buyers on an attractive valuation relative to our price target, which remains $15 and has clear potential upside.”
According to TipRanks.com, Curran has currently no stars on a ranking scale of 0-5 stars, with an average return of -9.3% and a 39.4% success rate. Curran covers the Basic Materials sector, focusing on stocks such as Solaris Oilfield Infrastructure Inc, Independence Contract Drilling, and Ranger Energy Services Inc.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Energy Recovery with a $14.50 average price target.
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