Investors should buy the dip on Johnson Controls , according to Deutsche Bank. Analyst Nicole DeBlase upgraded Johnson Controls to buy from hold, saying in a note to clients Wednesday that Johnson Controls has less exposure to businesses that are near peak growth. "We see this underperformance as unfounded, including relative to HVAC peers, given JCI has less resi exposure and no transport refrigeration exposure, both of which could be near peak growth," DeBlase wrote. Johnson Controls shares are down 20% year to date, making them the second-worst performers among HVAC companies, the note said. However, the company also has less to other troubled markets, including overseas countries impacted from the Russia-Ukraine conflict, according to Deutsche Bank. A greater macro trend toward sustainability will also benefit Johnson Controls. Johnson Controls generates just 17% of sales from Europe, Middle East, and Africa (EMEA) markets, compared to its peers, which generate 22% on average, Deutsche said. The company also gets just 6% of sales from China — lower than its peers. "In the ever-changing current macro construct, we see JCI as attractively positioned to weather the storm, with secular megatrend growth drivers to boot," DeBlase wrote. Deutsche Bank trimmed its price target on the stock to $79 per share from $80. However, the new target still implies upside of more than 22% from Wednesday's close. —CNBC's Michael Bloom contributed to this report.
Twenty/20
Investors should buy the dip on Johnson Controls, according to Deutsche Bank.