Travis Steed, an analyst from Bank of America Securities, reiterated the Hold rating on Solventum Corporation (SOLV – Research Report). The associated price target was raised to $85.00.
Travis Steed has given his Hold rating due to a combination of factors surrounding Solventum Corporation’s recent strategic moves. The company has announced the sale of its Purification & Filtration (P&F) business to Thermo Fisher for $4.1 billion, which is expected to be neutral to 2025 earnings per share but potentially accretive. This divestiture is part of Solventum’s broader strategy to streamline operations and focus on higher-margin areas, which could lead to improved financial performance in the long term.
Despite these positive developments, the stock’s current valuation already reflects much of the anticipated benefits from the turnaround strategy. The net leverage reduction from 3.7x to 2.0x post-sale provides Solventum with more financial flexibility, yet the stock’s price objective of $85 suggests limited upside from its current price. As such, Travis Steed maintains a Neutral rating, indicating a balanced view of the risks and rewards until further clarity on future earnings emerges.
In another report released yesterday, Piper Sandler also maintained a Hold rating on the stock with a $75.00 price target.