3M rating upgraded because of stock price
Analyst Brian Langenberg of Langenberg & Company raised his rating on 3M Co. from "hold" to "buy" because the Maplewood company's stock recently was trading 14 percent off its March 2 52-week high of $170.50 per share.
In December, Langenberg had downgraded 3M when the stock was around $166 per share. With the stock now trading around $144 per share, Langenberg sees room for about a 17 to 18 percent stock price appreciation, enough room to merit an upgrade.
Research report on Target bullish
Wells Fargo Securities analyst Matt Nemer has an "outperform" rating on Target Corp., and he wrote a bullish research report on Wednesday after Target reported solid second-quarter results.
Sales in signature Target categories — including style, baby, kids and wellness — were growing faster than other categories and much better in comparison to previous quarters. "The fact that these comp improvements are not largely driven by pricing or promotions is the icing on the cake, in our view," he wrote.
Nemer also is upbeat on Target's mobile and e-commerce initiatives, including plans by Target this fall to increase its ship-from-stores program from 140 to 450 locations and an "available to promise" test that would assure two- to three-business-day delivery on online orders. Both are efforts to better compete with online retailer Amazon.
Analyst: Pentair action might be in wrong area
An activist investment group had been pushing Pentair PLC to make more acquisitions. In a June 23 filing with the Securities and Exchange Commission, New York-based Trian Group, led by investor Nelson Peltz, disclosed it had met with management to discuss how Pentair could increase shareholder value trough "prudent industry consolidation."
On Monday, Pentair, based in England but managed from Golden Valley, announced it would pay $1.8 billion in cash for fastening products maker Erico Global Co. in Solon, Ohio.
Analyst David Rose of Wedbush Securities called the deal "a decent, but not great acquisition" in a research note Tuesday. "Despite the recent push by activist investor Trian for Pentair to be a consolidator in the flow space," wrote Rose, "Pentair unexpectedly made an acquisition within its Technical Solutions."
"Rather than finding a value investment in the pump space where many companies are currently trading at a discount, Pentair appears to have pursued a low-risk acquisition," Rose said.