Wall Street Analysts Are Bullish on Top Conglomerates Picks


There’s a lot to be optimistic about in the Conglomerates sector as 3 analysts just weighed in on Builders Firstsource (BLDR), Energy Recovery (ERII) and HC2 Holdings (HCHC) with bullish sentiments.

Builders Firstsource (BLDR)

In a report released today, Alex Rygiel from B.Riley FBR reiterated a Buy rating on Builders Firstsource, with a price target of $23. The company’s shares closed yesterday at $18.98, close to its 52-week high of $19.30.

Rygiel wrote:

“We are raising our estimates on BLDR following strong 2Q19 results Buy which showed solid execution despite lumber price volatility, resulting in share gains especially within the value-added product portfolio. We are raising our price target from $19 to $23 and reiterate our Buy rating.”

According to TipRanks.com, Rygiel is a 4-star analyst with an average return of 5.7% and a 54.6% success rate. Rygiel covers the Basic Materials sector, focusing on stocks such as Granite Construction Inc, Tutor Perini Corp, and Quanta Services.

Currently, the analyst consensus on Builders Firstsource is a Moderate Buy with an average price target of $20.75, which is a 9.3% upside from current levels. In a report issued on August 5, Seaport Global also maintained a Buy rating on the stock with a $22 price target.

See today’s analyst top recommended stocks >>

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 yesterday at $9.92.

Curran said:

“In light of our NDR last month and the 2Q results and call, we are revising our revenue/EBITDA/ EPS for 2019 from $101.8M/$23.9M/$0.30 to $84.2M/$10.2M/$0.12, and 2020 from $158.3M/ $61.7M/$0.80 to $113.5M/$25.7M/$0.35. Among our key assumptions: we now assume (1) Water annual revenue growth/gross margin for 2019 of 13%/71.5% and for 2020 10%/71.7%, and (2) Oil & Gas gets VorTeq past M1 (Milestone 1) in 4Q19, to commercial revenue generation in 4Q20. At its current level, we believe the stock discounts a mere 12% probability of full commercialization success, which equates to about $2/share, and remains unlikely to price in a higher probability until one of two potential catalysts occur.”

According to TipRanks.com, Curran ‘s ranking currently consits of no stars on a 0-5 ranking scale, with an average return of -11.7% and a 34.1% success rate. Curran covers the Basic Materials sector, focusing on stocks such as Solaris Oilfield Infrastructure Inc, Independence Contract Drilling, and Select Energy Services Inc.

Energy Recovery has an analyst consensus of Moderate Buy, with a price target consensus of $15.

HC2 Holdings (HCHC)

B.Riley FBR analyst Sarkis Sherbetchyan reiterated a Buy rating on HC2 Holdings yesterday and set a price target of $11. The company’s shares closed yesterday at $2.03, close to its 52-week low of $1.90.

Sherbetchyan wrote:

“Buy-rated HC2 Holdings (HCHC, $11 PT) reports 2Q19 results after market close on Thursday, 8/8, and will host its EPS call at 5:00 p.m. ET (dial-in: 877.300.8521; ID: 10133989). We model revenues/adjusted EBITDA of $400M/$25M from HCHC’s core operating subsidiaries (construction, marine services, telecom, and energy), and outline our 2Q expectations for the segments in Exhibit I: “Segment-Level Estimates” on page 2 of this report. We are the only analyst with published estimates.”

According to TipRanks.com, Sherbetchyan has 0 stars on 0-5 star ranking scale with an average return of -6.1% and a 37.4% success rate. Sherbetchyan covers the Consumer Goods sector, focusing on stocks such as Vishay Precision Group, S&W Seed Company, and Ferroglobe PLC.

Currently, the analyst consensus on HC2 Holdings is a Moderate Buy with an average price target of $11.

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