CSFB Ups Amphenol to Outperform

Analyst Michael Walker says markets are overestimating the long term impact of commodities prices on the company's earnings

CSFB raised its investment recommendation on Amphenol (APH ) to outperform from neutral.

Analyst Michael Walker said the stock price's recent 15% pullback took place amid concerns that he sees as near term and non-fundamental. He says the industry's biggest headwind -- a reason he believes Amphenol has lagged -- is raw material pricing, with rising prices for key inputs such as copper, gold, and oil-based plastics. However, he notes that this is not new; input prices have been rising since early 2004, during which time Amphenol has grown over 200 basis points, reflecting its ability to pass on price increases he doesn't see disappearing in this non-commodity, moderate-demand environment. He sees $2.30 2005 earnings per share and $2.68 in 2006. He has a $47 price target on the stock.

All of the views expressed in this research report accurately reflect the research analyst's personal views regarding any and all of the subject securities or issuers. No part of analyst compensation was, is or will be, directly or indirectly related to the specific recommendations or views expressed in this research report.
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