Trane upgraded to Overweight from Equal Weight at Stephens

Stephens upgraded Trane (TT) to Overweight from Equal Weight with a price target of $475, up from $412. While the firm had been awaiting “an opportunistic entry point before recommending buying shares,” its upgrade is based on where it believes Trane is headed, namely “toward top-tier compounder status, valued with a quality-growth premium alongside a select group of industrials.” The company’s strengths – including culture, a well-tuned operating system, a direct commercial sales force and strong aftermarket/service contribution – should be “well-known,” but the firm does not believe these benefits are fully reflected in a share price that currently sits about 8% below last fall’s level, the analyst tells investors.