Why RTI International Metals Inc. Could Pop 40%

Before you go, we thought you'd like these...
Before you go close icon

While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking upgrades and downgrades -- just in case their reasoning behind the call makes sense.

What: Shares of RTI International Metals  surged 6% today after J.P. Morgan upgraded the titanium products producer from neutral to overweight.

So what: Along with the upgrade, analyst Michael Gambardella raised his price target to $34 (from $32), representing about 40% worth of upside to yesterday's close. So while momentum traders might be turned off by RTI's sharp year-to-date pullback, Gambardella's call could reflect a sense on Wall Street that industry tailwinds give the company plenty of cause to rebound.


Now what: According to J.P. Morgan, RTI's risk/reward trade-off remains rather attractive at this point. "RTI commands a unique and increasingly valuable position as the sole North American supplier of titanium mill products for Airbus with an estimated 30-35% market share," said Gambardella. "Based on forecasts from J.P. Morgan's Aerospace & Defense team as well as recent commentary and test flight results from Airbus, we expect higher A350 XWB build rates will help drive RTI's 2015 earnings ahead of expectations; our updated estimates are 19% higher than consensus."

When you couple that upbeat outlook with RTI's beaten-down stock price -- still off 30% from its 52-week high even with today's rally -- it's tough to disagree with J.P. Morgan's bullishness.

More reliable ways to build wealth
The smartest investors know that dividend stocks simply crush their non-dividend paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

The article Why RTI International Metals Inc. Could Pop 40% originally appeared on Fool.com.

Brian Pacampara has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners

Man Is Horrified To Learn His Biological Father's Identity - But A Look In The Mirror Man Is Horrified To Learn His Biological Father's Identity - But A Look In The Mirror
Nature Gets Revenge On Safari Hunter Who Killed Elephants And Lions For Sport Nature Gets Revenge On Safari Hunter Who Killed Elephants And Lions For Sport
12 Facts That Will Make You Smarter Than Your Friends 12 Facts That Will Make You Smarter Than Your Friends