Calling the EPS miss ($0.26 is light by $0.03) high-quality, analyst James Albertine maintains a Buy rating and $39 price target. The culprit, he says, was higher than expected operating expenses, but gross margin exceeded his estimate of 40.7% by 70 basis points.
FY2014 EPS guidance of $1.30-$1.40 compares to his team's $1.38. Organic parts and services growth of 8-10% compares to a 7.5% estimate. The company also expects to generate $375M in operating cash flow vs. $428M in 2013, and incur $110M-$140M in capex vs. $88M in 2013.