Barclays initiates Ralliant stock with Overweight rating, sees recovery ahead

Published 15/07/2025, 08:22
Barclays initiates Ralliant stock with Overweight rating, sees recovery ahead

Investing.com - Barclays (LON:BARC) initiated coverage on Ralliant Corp. (NYSE:RAL) with an Overweight rating and a $60.00 price target on Tuesday, representing a significant upside from the current trading price of $47.36. The $5.35 billion market cap company currently maintains a FAIR financial health rating according to InvestingPro data.

The investment bank believes Ralliant is currently at its cyclical trough following its recent spin-off from FTV, positioning the company for a potential sharp earnings upturn in 2026.

Barclays noted this recovery potential appears not to be factored into RAL’s current share price, creating what it describes as an attractive entry point for investors seeking stocks outside the artificial intelligence sector.

The firm pointed out that Ralliant is experiencing its eighth consecutive quarter of year-over-year organic sales declines, with 2025 organic sales estimated to finish approximately 9% below 2023 peak levels.

According to Barclays, the recent FTV/RAL Q2 pre-announcement suggests the company has moved past its point of maximum year-over-year organic sales declines, which occurred around the turn of the year, allowing investors to begin looking toward recovery.

In other recent news, Ralliant Corporation has commenced trading on the New York Stock Exchange as an independent entity following its spin-off from Fortive (NYSE:FTV) Corporation. The company has also announced a $200 million share buyback authorization, with no expiration date, as part of its capital allocation strategy. Meanwhile, Seaport Global Securities has initiated coverage on Ralliant with a Neutral rating, expressing mixed views on the company’s prospects due to current sales challenges and weak margins, particularly in its Tek division. BofA Securities also began coverage, assigning an Underperform rating due to valuation concerns, while noting potential improvements in Ralliant’s Test & Measurement segment by the second quarter of 2025. The firm emphasized the benefits Ralliant’s sensors business is gaining from global investments in electrical grid infrastructure and energy transition. Furthermore, Fortive, Ralliant’s former parent company, has completed the spin-off and warned of revenue pressures in its second quarter, projecting flat to slightly down revenue for the newly structured company. This separation distributed approximately 113 million shares of Ralliant common stock, marking a strategic restructuring. Olumide Soroye has taken over as President and CEO of Fortive, while Tami Newcombe has assumed the same roles at Ralliant.

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