In a report released yesterday, Andrew Obin from Bank of America Securities reiterated a Buy rating on Johnson Controls (JCI – Research Report), with a price target of $95.00.
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Andrew Obin has given his Buy rating due to a combination of factors including Johnson Controls’ strategic focus on improving free cash flow conversion and quality of earnings. The company’s CFO, Marc Vandiepenbeeck, emphasized a target of 100% cash conversion by 2025, supported by enhancements in inventory management and operational efficiencies. Additionally, Johnson Controls is planning to utilize proceeds from divestitures for share buybacks, indicating a strong capital allocation strategy.
Another factor influencing the Buy rating is the robust growth in Johnson Controls’ data center business, which is experiencing high double-digit increases in both revenue and orders. This segment, which constitutes a significant portion of the company’s revenue, is particularly strong in North America. Furthermore, the new CEO’s commitment to a comprehensive review of the company’s portfolio to optimize asset performance adds to the positive outlook for Johnson Controls.
In another report released on May 12, Deutsche Bank also upgraded the stock to a Buy with a $112.00 price target.
Based on the recent corporate insider activity of 128 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of JCI in relation to earlier this year.