NEW YORK (TheStreet) -- Shares of WESCO International Inc. (WCC - Get Report) are up 2.1% this morning to $89.39 after UBS (UBS - Get Report) upgraded the company to "buy" from "neutral," and raised its price target to $100. from $84.
The company is aprovider of electrical, industrial, and communications maintenance, repair and operating and original equipment manufacturers products, construction materials, and advanced supply chain management and logistic services.
"Organic growth likely to reaccelerate as end markets begin to recover in 2014," the firm said in a note. "We expect WCC to deliver 5% organic growth in 2014 (near the high-end of the guidance range), following flat core growth in 2013, and anticipate further improvement in 2015 (+7.5%)."
Also, UBS said, "We expect M&A to supplement core growth as leverage moves lower WCC takes a disciplined approach to M&A, generally targeting assets that are more profitable than WCC, have a risk-adjusted return greater than WCC's WACC, are accretive in year one, and are a good strategic fit (supplement WCC's position in key product categories, end markets, etc.)."
TheStreet Ratings team rates WESCO INTL INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate WESCO INTL INC (WCC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- WCC's revenue growth has slightly outpaced the industry average of 6.4%. Since the same quarter one year prior, revenues rose by 14.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The strong earnings growth this company has enjoyed -- up -- has apparently played a role in driving up its share price by a solid 25.59%. In addition, the rise in the general market has likely contributed to this stock's strong performance during this past year.Regarding the stock's future course, although almost any stock can fall in a broad market decline, WCC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- WESCO INTL INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, WESCO INTL INC increased its bottom line by earning $5.26 versus $3.95 in the prior year. This year, the market expects an improvement in earnings ($5.55 versus $5.26).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Trading Companies & Distributors industry. The net income increased by 118.8% when compared to the same quarter one year prior, rising from $26.51 million to $57.99 million.
- You can view the full analysis from the report here: WCC Ratings Report