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Investing.com - RBC Capital initiated coverage on QXO Inc (NASDAQ:QXO) with an Outperform rating and a price target of $33.00. Currently trading at $21.63, the stock sits below analyst targets ranging from $27 to $44, according to InvestingPro data.
The research firm highlighted QXO’s unique position in the building products distribution sector, noting its ambition to significantly consolidate and innovate within the industry.
RBC Capital emphasized that QXO operates "unbound and unconstrained by conventional norms faced by competitors," giving it a competitive advantage in the market.
The firm pointed to QXO’s healthy capital structure and attractive cost of capital via its elevated multiple as key strengths that position the company for growth through mergers and acquisitions.
RBC Capital specifically identified M&A activity as a potential catalyst for QXO, along with "a strong improvement runway at Beacon," which the firm described as "a repeatable playbook."
In other recent news, QXO Inc. has announced a $2 billion common stock offering, with underwriters having the option to purchase an additional $300 million in shares. The proceeds from this offering are intended for general corporate purposes, including funding future acquisitions. Analysts at Citi and Truist Securities have initiated coverage of QXO with Buy ratings, citing the company’s consolidation strategy in the fragmented building products distribution sector as a key factor. Citi has set a price target of $33.00, while Truist Securities has set a target of $30.00. Both firms highlight CEO Brad Jacobs’ track record in successful consolidations and his strategic approach to growth. In personnel news, QXO has appointed Eric Nelson, a veteran from The Kraft Heinz (NASDAQ:KHC) Company, as the new chief information officer. Nelson brings extensive experience in technology and operational leadership, which is expected to support QXO’s growth ambitions. These developments reflect QXO’s ongoing efforts to expand its market presence and enhance its operational capabilities.
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