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On Monday, Oppenheimer reiterated its Outperform rating on Modine Manufacturing (NYSE:MOD) with a $145.00 price target, representing an 80% upside from the current price of $80.80. The research firm’s analysts highlighted Modine’s robust outlook for data center growth, citing positive customer feedback, an expanding project pipeline, and recent business wins. According to InvestingPro data, analyst targets for MOD range from $135 to $155, with the stock currently trading at a P/E ratio of 26.5x. Modine’s management team, including CEO Neil Brinker, CFO Mick Lucarelli, and IR Kathy Powers, expressed strong confidence in the company’s future during a fireside chat last Friday.
The management team discussed the acceleration of the PT 80/20 transformation, which is expected to yield targeted margin expansion despite sluggish end-markets. They also outlined a successful tariff mitigation strategy. The conversation with Oppenheimer’s analysts touched upon Modine’s growing mergers and acquisitions (M&A) funnel, which indicates a high likelihood of accretive customer solutions deals in the coming year.
Modine’s recent announcement of a share buyback program was seen as a signal from the management and board that they perceive the current valuation compression of the company’s stock as an opportunity. The analysts at Oppenheimer consider Modine Manufacturing a Top Idea within their coverage, underscoring the potential they see in the stock. The reaffirmed rating and price target reflect Oppenheimer’s positive outlook on the company’s strategic initiatives and growth prospects. For deeper insights into MOD’s valuation and 12 additional exclusive ProTips, visit InvestingPro, where you’ll find comprehensive analysis and the full Pro Research Report.
In other recent news, Modine Manufacturing announced a significant $180 million order for data center cooling products in partnership with a major AI infrastructure developer. This development, noted by DA Davidson, supports Modine’s projected growth in organic data center revenue by fiscal year 2026. Additionally, Oppenheimer maintained its Outperform rating for Modine, with a $145 price target, following strong fiscal third-quarter results that exceeded expectations. The company has reaffirmed its growth projections in the data center segment through fiscal year 2027.
Modine also announced a leadership change in its Performance Technologies segment, with Adrian I. Peace stepping down as President. CEO Neil D. Brinker will oversee the segment until a successor is appointed. The company aims to achieve adjusted EBITDA margins of 15% to 18% in the next two years through its 80/20 strategy. In another strategic move, Modine plans to open a new manufacturing facility in Chennai, India, by mid-2025, focusing on advanced cooling technologies for data centers and power generation equipment.
Oppenheimer highlighted Modine’s robust mergers and acquisitions pipeline, which could lead to value-adding transactions. The firm’s analysis suggests that Modine’s current valuation may not fully reflect its potential. Modine’s recent announcements, including a share buyback program, indicate management’s confidence in future opportunities.
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