The firm said it lowered its rating on the company, which provides products, services, and solutions to enhance the comfort of air in homes and buildings, and secure homes and commercial properties, as the Ingersoll is moving its focus to mergers and acquisitions, from buybacks, adding integration risks.
Baird cut its price target to $65 from $68 on the stock.
Must Read: Warren Buffett's 25 Favorite Stocks
Stocks TO Buy: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn More.
Separately, TheStreet Ratings team rates INGERSOLL-RAND PLC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate INGERSOLL-RAND PLC (IR) 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, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- IR's revenue growth has slightly outpaced the industry average of 3.6%. Since the same quarter one year prior, revenues slightly increased by 4.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.56, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.79 is somewhat weak and could be cause for future problems.
- INGERSOLL-RAND PLC has improved earnings per share by 27.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, INGERSOLL-RAND PLC reported lower earnings of $2.08 versus $3.29 in the prior year. This year, the market expects an improvement in earnings ($3.25 versus $2.08).
- The gross profit margin for INGERSOLL-RAND PLC is currently lower than what is desirable, coming in at 33.56%. Regardless of IR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 8.63% trails the industry average.
- Net operating cash flow has decreased to $246.10 million or 43.65% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- You can view the full analysis from the report here: IR Ratings Report
EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he and Stephanie Link think could be potentially HUGE winners. Click here to see the holdings for FREE