Analyst Upgrades Shares Of Modine Manufacturing

HARTFORD, Conn. (AP) — After lagging its peers, shares of Modine Manufacturing Co., which makes heaters and air conditioners for automobiles, are set to rise during the next cyclical upturn as global vehicular end markets recover over the next several years, an analyst said Tuesday.

David Leiker of R.W. Baird upgraded the Racine, Wis., company to "Outperform" from "Neutral."

Shares of Modine could approach $30 during a cyclical recovery, which would be nearly four times their closing price of $8.07 Monday, Leiker said in a client note.

The shares have "meaningfully underperformed" other commercial truck companies and an equity offering Thursday alleviated concerns regarding balance sheet leverage and cost structure "that weakened the story," he said.

Modine increased the size of a share offering to 12 million from 9 million. It priced each share at $7.15. The transaction is expected to close this Wednesday.

Modine has said that it expects to raise net proceeds of $81 million, in part to repay its debt.