RE:RBC Global 30RBC ups their price target from $30. to $31. and cites it as their #1 best idea for 2024.
A summary of their reasons are:
1. Element Fleet's Versatility: Element Fleet (EFN) is identified as a top investment choice due to its perceived ability to perform well across various market scenarios in 2024, making it a versatile stock suitable for different economic conditions.
2. Positive Outlook and Catalysts: They express confidence in EFN's positive outlook, driven by factors such as the return of Original Equipment Manufacturer (OEM) production to pre-pandemic levels, upcoming retirement of preferred shares, and the company's success in acquiring new clients.
3. Attractive Industry and Growth Potential: EFN operates in an attractive industry with high barriers to entry, strong defensive attributes, and growth potential. Despite its defensive characteristics, EFN is seen to have several growth drivers, including opportunities in self-managed fleets and increased originations.
4. Undervalued Shares: EFN's shares are considered undervalued, trading at a low price-to-earnings (P/E) multiple compared to industry standards. They suggest that the company's shares should trade at a higher P/E multiple, supported by its re-classification from Financials to Industrials in the GICS.