BMO maintains $118 target on Veralto Corp, cites stability

Published 19/03/2025, 15:58
BMO maintains $118 target on Veralto Corp, cites stability

On Wednesday, BMO Capital Markets sustained its optimistic stance on Veralto Corp (NYSE:VLTO), maintaining an Outperform rating and a price target of $118.00. The firm’s confidence in Veralto is buoyed by the company’s recent management discussions, which underscored the strength and stability of its business model. According to InvestingPro data, the company maintains impressive gross profit margins of nearly 60% and operates with moderate debt levels, though current valuations suggest the stock trades at premium multiples.

Veralto Corp’s leadership, including CEO Jennifer Honeycutt, CFO Sameer Ralhan, and IR Ryan Taylor, have been actively engaging with investors, reinforcing the resilience of the company’s portfolio. The management team’s presentations highlighted Veralto’s strong free cash flow generation and robust balance sheet, positioning the company as a fundamental investment in the Materials/Industrial sector. InvestingPro analysis confirms this strength, showing liquid assets exceeding short-term obligations with a healthy current ratio of 1.92. For deeper insights into Veralto’s financial health and more exclusive tips, investors can access the comprehensive Pro Research Report, available to InvestingPro subscribers.

The company’s business, which is significantly linked to consumables in water and consumer staples, is expected to support growth in both price and volumes. This is particularly notable as it suggests potential for expansion despite economic uncertainties. BMO Capital analysts are confident that Veralto’s financial flexibility offers the management various options to foster growth.

Looking ahead, BMO Capital sees Veralto Corp as a top selection within its sector. The firm anticipates that Veralto will become a double-digit compounder in the coming years, suggesting significant growth potential for the company’s stock. The reiterated price target of $118.00 reflects this positive outlook, as Veralto continues to demonstrate its ability to navigate through challenging market conditions with a strong and adaptable business model.

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