By: Scott Davis

We love the theme of industrial laggards and IR has trailed the group by 700 bps LTM.  What has kept us on the sidelines have been three main issues: 1) IR was not a beneficiary of tax policy changes due to its Irish domicile; 2) IR had more price/cost risk than most – HVAC price typically lags by 2-3 quarters; 3) IR has less cyclicality and op leverage than other names we are recommending – notably EMR, ROK, RXN, ITT, and ETN.

IR Report Here