Evercore ISI Revises Ratings Post-Election

Investing.com reports that Evercore ISI has revised its ratings for various industrial and machinery stocks after the recent US election results. The investment bank cites a more optimistic business outlook tied to anticipated "pro-business Trump" policies.

Cautious Outlook

Despite the upgrades, Evercore is cautious, noting that while a "Trump/Red Sweep" requires less caution, there’s still no reason for broad bullishness given the challenging current conditions.

Upgrades

Evercore upgraded the following companies:
– Timken Company (NYSE:TKR): Upgraded from In-Line to Outperform despite risky execution, indicating a favorable risk-reward balance.
– Cummins (NYSE:CMI): Expected to benefit from an early truck emission pre-buy cycle projected in 2025. Analysts emphasize Cummins as the "#1 truck engine & after-treatment supplier."
– Paccar (NASDAQ:PCAR): Also upgraded, reflecting expectations of growth recovery in the second half of 2025 due to emission pre-buy demands.

Downgrades

Conversely, Evercore downgraded several stocks:
– Eaton (NYSE:ETN): Downgraded for being overvalued and as a "valuation 'breather' call."
– Caterpillar (NYSE:CAT): Facing downside EPS risk due to high construction equipment inventory and intense global competition.
– ESAB Corp (NYSE:ESAB) and Illinois Tool Works (NYSE:ITW): Cited for high valuations and specific risks.

Conclusion

Overall, Evercore’s stance emphasizes cautious investment strategies, recommending selective investments instead of a broad bullish outlook. Their top five favored stocks include Parker Hannifin (NYSE:PH), United Rentals (NYSE:URI), Cummins, Timken, and Paccar.