U.S. Industrials Looking Better To Morgan Stanley Analysts

The caution that reigns this year for U.S. industrial companies is under attack.

Tuesday, Morgan Stanley analysts and strategists said investors had gotten too pessimistic on industrials and on makers of electrical equipment as they upgraded the firm's investment ratings on the sector. They predicted that strong orders and other positives will push the stocks to outperform the S&P 500 this year.

"We now see substantially more upside for industrial stocks than the overall S&P, driven by sharply rising order books, structural cost improvements, rational global pricing" and government stimulus, wrote the analysts led by Scott R. Davis. They upgraded individual investment ratings on Caterpillar Inc. (CAT) and two other companies, and were joined by the firm's equity strategists, who said earnings expectations have gotten too low, "particularly in the U.S."

Read Full Article from Wall Street Journal

- Posted: 2010-02-09 11:11:56

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