Air Products surged to the head of the S&P 500 Monday, clearing a buy point. The stock received several upgrades, after Friday's Wall Street Journal report that activist investor Mantle Ridge had, since March, built a stake worth more than $1 billion in the company.
Vertical Research upgraded Air Products to a buy rating from a hold with a 336 price target. The firm called the Mantle Ridge news a "game changer." Vertical Research expects Mantle Ridge to push Air Products executives on succession planning for Chief Executive Seifi Ghasemi, as well as work on capital deployment and creative means to unlock shareholder value.
Jefferies analyst Laurence Alexander also upgraded Air Products to a buy rating, increasing the price target to 364, up from 295. This represents 19% upside compared to current trading levels. Alexander wrote Monday that an activist stake could give Air Products an opportunity to both reset its narrative to "quality growth" and tie shareholder returns to company initiatives rather than policy shifts and commodity spreads.
The S&P 500 stock surged more than 7% to 306 early during Monday's early market trade, jumping above a traditional 296 buy point from a flat base, according to MarketSurge charts. On the year, Air Products stock has gained 4.3%. Shares are up 46% from a February low.
Separately, at the end of September Air Products completed the sale of its liquefied natural gas process technology and equipment business to Honeywell for $1.8 billion in cash. The deal was first announced in July.
The S&P 500 stock has a 71 Composite Rating out of a best-possible 99. Shares also have a 63 Relative Strength Rating and a 78 EPS Rating.
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