HUBB - Hubbell declines after UBS downgrades stock to Sell

Hubbell ( NYSE: HUBB ) declined as much as 5.6% on Wednesday after analysts at UBS downgraded the stock to Sell from an investment rating of Neutral. They said the maker of electrical equipment is overvalued compared with peers and faces a slowdown in spending by public utilities.

“We see risk of 2023 multiple compression with Hubbell ( HUBB ) shares currently trading at” a premium of three standard deviations compared with the broader market,  Chris Snyder, analyst at UBS, said in a Jan. 4 report. “Amongst our 30-plus multi-industry names tracked, Hubbell ( HUBB ) sports the biggest disconnect between margin profile and EPS.”

UBS lowered its price target for Hubbell ( HUBB ) to $225 a share from $254 a share previously, based on a multiple of about 19 times estimated EPS for Q4 2023 to Q3 2024.

The bank also downgraded Honeywell International ( HON ) to Sell from Buy and Emerson Electric ( EMR ) to Neutral from Buy.

Hubbell ( HUBB ) in the past 12 months rose about 12%, contrasting with a 20% decline for the Standard & Poor's 500 stock index ( SP500 ).

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