Tenneco Soars On Analyst, Management Confidence

DETROIT (AP) — Shares of Tenneco Inc. rose more than 15 percent Tuesday after KeyBanc Capital Markets Inc. reiterated its "Buy" rating on the company, expressing confidence in the auto supplier's ability to sustain itself during the current auto sales and production slowdown.

The company also reported that it is compliance with the New York Stock Exchange's listing requirements.

Shares of the Lake Forest, Ill.-based maker of emission control system rose $1.24 Tuesday, or 15.5 percent, to $9.24.

KeyBanc analyst Brett D. Hoselton said comments given by the company's management team at a KeyBanc conference last week suggest that Tenneco will be able to improve free cash flow, and remain compliant with its covenants.

"While financial risk remains high, we are incrementally confident that the risk is manageable," Hoselton wrote. "At our conference management affirmed that its new business wins are exceeding expectations. Specifically, Tenneco is winning more commercial vehicle business than it had originally anticipated."

Last week Tenneco said that it formed a joint venture with Beijing Hainachuan Automotive Parts Company Limited to produce vehicle emission control exhaust systems for the Chinese car market. Initially, the new joint venture will supply emission control systems for Beijing Hyundai starting in 2010.