Bubble or no bubble, this is the best stock for AI exposure: analyst
Investing.com - KeyBanc upgraded Carpenter Technology (NYSE:CRS) from Sector Weight to Overweight and established a price target of $380.00, representing a potential 14.5% upside from the current price of $332.01. According to InvestingPro data, CRS is trading near its 52-week high of $338.08, after an impressive 96.4% gain year-to-date.
The upgrade reflects KeyBanc’s expectation that strong pricing, favorable product mix, and effective cost control in the company’s Specialty Alloys Operations (SAO) segment will drive performance in fiscal year 2026. This aligns with analysts’ EPS forecast of $10.17 for FY2026, and InvestingPro data shows that two analysts have recently revised their earnings upwards for the upcoming period.
KeyBanc highlighted new three to five year long-term agreements at approximately 10% higher prices, ongoing strength in transactional pricing, and potential mix improvements later in FY26 as key factors supporting the rating change.
The firm believes these elements will provide Carpenter Technology with the capacity to exceed operating income expectations for fiscal years 2026 and 2027, particularly as Boeing 737/MAX production growth resumes.
KeyBanc also noted that mid-to-long-term investments to expand higher-margin aerospace products could add to the company’s enterprise value in the latter part of the decade.
In other recent news, Carpenter Technology Corporation reported impressive financial results for the first quarter of fiscal year 2026, with earnings per share reaching $2.43, surpassing the forecast of $2.12. The company’s revenue also exceeded expectations, totaling $733.7 million against the anticipated $699.67 million. Additionally, Carpenter Technology announced the pricing of a $700 million offering in senior notes at 5.625%, with the funds intended for redeeming existing notes and other corporate purposes. Fitch Ratings upgraded Carpenter Technology’s Long-Term Issuer Default Rating to ’BBB-’ from ’BB+’, moving the company into investment grade territory with a Stable Outlook. The rating agency also upgraded the company’s senior unsecured debt and affirmed the secured revolving credit facility at ’BBB-’. In another development, BTIG raised its price target for Carpenter Technology to $365 from $305, maintaining a Buy rating following the company’s strong earnings report. These developments reflect a positive outlook for Carpenter Technology as it continues to execute its financial and strategic initiatives.
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