Citi opens ‘positive catalyst watch’ on Allison Transmission into earnings

Citi lowered the firm’s price target on Allison Transmission to $52 from $55 and keeps a Neutral rating on the shares. The analyst also opened a "30-day positive catalyst watch" on the shares ahead of the company’s Q1 earnings, given the upside the firm sees to both buy-side and sell-side 2023 estimates. It increased estimates largely to reflect a higher North America on-highway and parts equipment revenue outlook, which it says should drive a mix benefit for Allison. Citi also expects U.S. non-residential construction spending to be solid through 2024, which should help contribute to some level of decoupling between straight trucks and tractors.