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Atkore Stock (NYSE: ATKR) Price Target Reaffirmed at $190 Loop Capital

Analyst Team trader
Updated 8 Jul 2024

Loop Capital has reaffirmed its faith in Atkore Inc stock (NYSE: ATKR) with a Buy rating and a robust $190 price target, citing an anticipated re-rating on the back of a notably improved profitability scenario over the last few years.

Despite short-term headwinds, the positive stance reflects the firm's belief in longer-term secular tailwinds powered by macroeconomic and industry-specific drivers which are expected to give a sustainable lift to Atkore's financials.


Stock Performance Overview

Atkore's shares are trading closer to the lower end of the 52 week range, so an upswing in sentiment will be required to shift the momentum. This situates the stock within the annual range between a low of $121.0 and a high of $194.98, atop a market capitalization of $4.77 billion.

While acknowledging potential short-term pressures such as possible incremental destocking in HDPE or High-Density Polyethylene, delays in the Hobart ramp-up, and concerns on PVC capacity, Loop Capital looks favourably upon Atkore's future.

The analyst highlights strong secular tailwinds, including the need for disaster-hardening of infrastructure, the acceleration of data center constructions, expected boost from government stimulus, and a reshoring trend that is all but set to inject vitality into the company's prospects.

Atkore at a Glance

Headquartered in Harvey, Illinois, Atkore Inc. is a stalwart in the Electrical Equipment & Parts industry within the Industrials sector. The company is celebrated for its comprehensive portfolio, which includes conduits, cables, and a suite of safety and infrastructure products and solutions critical to the new construction sector and various maintenance, repair, and remodel markets. Atkore, formerly known as Atkore International Group Inc., enjoys sustained demand across diversified industrials, alternative power generation, healthcare, data centers, and government clients.

In financial terms, the company maintains an impressive footing, characterized by a trailing P/E ratio of 8.16 and a more forward-looking P/E of 7.37. Moreover, with a dividend rate of $1.28 coupled with a yield of 0.98% and a conservative payout ratio of 0.02, the company has been attentive to shareholder returns. At this juncture, Atkore boasts a robust total revenue of $3.38 billion and a net income to common stakeholders amounting to $609.5 million.

Institutional interest in Atkore is substantial, with insiders holding 0.883% and institutions holding 112.472% of the firm's shares, showcasing a strong endorsement from the investment community.

At the core of the recommendation lies an anticipation of EBITDA growth from a normalized base, reinforcing the confidence in Atkore's capacity to escalate its earnings before interest, taxes, depreciation, and amortization, painting a picture of a robust financial future.

Analysts on Atkore's Future

The mean target price among analysts stands at an ambitious $191, paired with an average recommendation of ‘buy', underscoring a consensus that sees past the momentary fluctuations to a horizon where Atkore thrives amidst industry and market trends. With 5 analysts offering opinions, the view is clearly positive from the street but that is not enough to form a proper evaluation.

Whilst Atkore Inc. remains a company to watch, you will always want to conduct your own extensive due diligence before making any decision.

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The AskTraders Analyst Team features experts in technical and fundamental analysis, as well as traders specializing in stocks, forex, and cryptocurrency.