Oshkosh Corp. announced the acquisition of engineering and product development company Pratt Miller for $115 million. The transaction is anticipated to close in the first quarter of 2021. Shares of the specialty vehicles manufacturer are up 2.7% in Wednesday’s pre-market session.
Oshkosh’s (OSK) COO John Pfeifer said, “We believe combining Pratt Miller’s engineering expertise with Oshkosh’s innovation and operational strengths will enable us to better serve customers and position our Company for growth.”
Pratt Miller’s CEO Matt Carroll said, “Together, we expect to grow our decade-long partnership and expand our pipeline of new business opportunities.”
In October, Oshkosh reported better-than-expected 4Q results. The company’s adjusted earnings of $1.30 per share came ahead of the Street’s estimates of $1.09 per share. Revenues generated $1.78 billion in the fourth quarter and exceeded analysts’ expectations of $1.66 billion. (See OSK stock analysis on TipRanks).
Following the acquisition, Robert W. Baird analyst Mircea Dobre maintained a Buy rating and a price target of $110 (25.5% upside potential). In a research note to investors, Dobre said that the acquisition will help the company in developing autonomous and connected vehicles.
Like Dobre, most of the Street has a bullish outlook on the stock. The Strong Buy analyst consensus is based on 10 Buys and 3 Holds. The average price target stands at $95.17 and implies upside potential of about 8.5% to current levels. Shares have declined 7.4% year-to-date.
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