ArvinMeritor Shares Rise After Goldman Upgrades

NEW YORK (AP) — Shares of ArvinMeritor Inc. jumped on Thursday after a Goldman Sachs analyst upgraded the auto parts supplier and raised his rating on the automotive sector.

Shares of the Troy Mich.-based company rose 29 cents, or 8.3 percent, to $3.78 in midday trading.

Auto analyst Patrick Archambault upgraded ArvinMeritor, which manufactures an array of commercial vehicle systems, to "Buy" from "Neutral" and lifted his price target to $5 from $3 in a note to investors.

The new price target implies an upside of 43 percent from its Wednesday close of $3.49.

Archambault said ArvinMeritor is poised to benefit from a recovery in production of certain trucks and from an improved cost structure, which will outweigh weaker European production.

The analyst also raised his coverage view of the auto sector to "Attractive," from "Neutral," saying a "rising tide" of auto sales, backed by falling interest rates at financing companies and a vehicle scrappage bill, is likely to drive shares higher.