Rock-Tenn initiated at Outperform by Wells Fargo

|By:, SA News Editor

Wells Fargo initiates Rock-Tenn (RKT) at Outperform with a PT of $140-$145 (20.7% potential upside at the midpoint).

Analyst Christopher Manuel: "In our view, RKT maintains a compelling earnings growth story given favorable industry dynamics (upward sloped demand curve and tight inventory levels) and the realization of an additional $100MM in performance improvement savings ... [T]he ideal opportunity for capital redeployment would be if RKT could find another $500MM-2.5B acquisition to start the integration/delevering process all over again."