UBS raises RPM International PT to $119, maintains Neutral rating.

UBS raises RPM International PT to $119, maintains Neutral rating.

UBS has revised its price target for RPM International (NYSE: RPM) to $119, while maintaining a Neutral rating on the stock. The update follows recent trends in the company's financial metrics and growth prospects. RPM International has been gaining momentum, particularly in its return on capital employed (ROCE), which has shown a promising upward trend over the last five years [1].

According to the latest data, RPM International's ROCE has grown by 26% while employing roughly the same amount of capital. This indicates that the company is generating higher returns from its existing capital base, suggesting improvements in operational efficiencies. The current ROCE stands at 17%, which is significantly higher than the industry average of 10% for the Chemicals sector [1].

UBS analysts believe that RPM International's ability to collect higher returns from the same amount of capital is a positive sign for long-term growth prospects. However, they also caution that the company's stock has already rewarded shareholders with a 66% return over the last five years, indicating that the market may have already priced in some of the positive developments [1].

While RPM International's fundamentals are promising, UBS analysts advise investors to conduct further due diligence. One potential warning sign identified by Simply Wall St is the company's current ROCE, which, while strong, may not be the highest in its industry. Investors should consider this factor as part of their investment process [1].

In conclusion, UBS's revised price target and Neutral rating reflect the company's recent financial performance and growth prospects. RPM International's growing ROCE and operational efficiencies make it an interesting investment opportunity, but investors should proceed with caution and conduct thorough research.

References:
[1] https://finance.yahoo.com/news/returns-gaining-momentum-rpm-international-122601970.html