Street Calls of the Week
Investing.com - Goldman Sachs downgraded IHI Corp. (7013:JP) (OTC:IHICY) from Buy to Neutral with a price target of JPY3,250.00, citing limited upside potential following significant share price appreciation. This aligns with InvestingPro analysis, which indicates the stock is trading above its Fair Value, with shares currently near their 52-week high of $21.97.
The Japanese industrial company’s stock has risen 171% since Goldman Sachs initiated coverage on January 12, 2025, substantially outperforming the TOPIX index’s 20% gain during the same period. The stock’s impressive YTD return of 172.13% reflects this strong momentum, with particularly robust gains of 101.84% in the past six months alone.
Goldman Sachs maintained its earnings estimates and price target for IHI, noting the company’s "robust" fundamentals supported by its aero engine business and successful implementation of business portfolio reforms.
The investment bank indicated IHI’s current valuation multiples have reached FY3/27E P/E of 28X and FY3/28E P/E of 26X, which are now comparable to European and U.S. peers in the aerospace engine sector.
The downgrade reflects Goldman Sachs’ view that IHI’s fundamentals are fully priced in, with the firm stating it assumes "further multiple expansion is unlikely" for the stock.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.