Piper Sandler cuts PT for Patterson Companies on adjustment in peer group multiples

Patterson Companies

17/10/2022 13:47

** Piper Sandler cuts price target for dental and animal
health product co Patterson Companies Inc  PDCO.O  to $35 from
$40, maintains 'overweight' rating
    ** Updated PT implies an upside of ~34% on last close, vs an
upside of ~53% for previous PT   
    ** PT cut driven by an adjustment in multiples of PDCO's
peer group, brokerage says
    ** PDCO shares down 11% this year vs S&P 500's 25% drop 
    ** Last week, PDCO appointed CFO Don Zurbay as CEO,
reaffirmed 2023 profit forecast  urn:newsml:reuters.com:*:nTUABYF1FL
    ** Co in investors' "do-not-touch" territory due to value
destruction and past mismanagement - Piper Sandler
    ** Says investors don't fully appreciate co's solid track
record and improved margin profile   
    ** Brokerage overall bullish on co for durable end markets
(dental and animal health), less exposed to cyclicality like
other healthcare categories
    ** Eleven of 15 brokerages covering the stock rate it
'hold', three 'buy' or higher and one 'strong sell'; median PT
is $33 - Refinitiv IBES data             
 (Reporting by Anirban Chakroborti in Bengaluru)
 ((Anirban.Chakroborti@thomsonreuters.com;))