Jim Cramer Disagrees With Goldman Sachs' Downgrade of Pentair

Next Monday is TheDeal's Corporate Governance Conference, in which TheStreet's Jim Cramer, manager of the Action Alerts PLUS portfolio, will be in attendance.

Among the different speakers, Cramer is looking forward to hearing from Randall Hogan, CEO and chairman of Pentair, and Ed Garden, a founding partner of Trian Partners and Pentair's (PNR) chief investment officer.

Pentair has been breaking off several of its business units in an attempt to create value for shareholders. Cramer said he expects Hogan and Garden to explain how activist investor relationships can be good, with constructive engagement leading to better returns.

Trian, run by Nelson Peltz, has been seen as an activist with various companies over the years.

With Pentair shares up 18.8% on the year and 10.7% over the past 12 months, some would view management's recent moves positively. However, analysts at Goldman Sachs aren't so sure.

The firm hit Pentair with a sell rating, arguing that the valuation is stretched, margins have limited upside and that downside could exist based on a sum-of-the-parts valuation. Cramer was beside himself, calling the rating ill-advised.

To learn more about TheDeal's upcoming conference, click here.

At the time of publication, Cramer's Action Alerts PLUS had no position in any companies mentioned.

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