Teledyne resumed with a Buy at UBS

UBS resumed coverage of Teledyne (TDY) with a Buy rating with a price target of $585, up from $525. The company has a strong track record of compounding growth via M&A driving consistent double-digit EPS growth, though the stock is trading at relative discount to peers and historical valuation, which UBS thinks is largely due to slowing organic growth in 2023-2024, driven by short cycle industrial weakness, but healthy book-to-bill rates and a positive year over year organic sales inflection in Q3 are encouraging, the analyst tells investors in a research note. The firm thinks accelerating organic growth will restore sentiment and support multiple re-rating and sees a strengthening outlook for short cycle activity in 2025, and believes Teledyne will return to double-digit EPS growth.