Citi Sees Long-Term Opportunities for Precision Castparts Corp.

Citi initiates coverage on Precision Castparts Corp. (NYSE: PCP) with a Buy rating and $173 price target. Citi set its price target based on its belief that PCP can sustain long-term growth.

In a note to clients, Citi writes, "Emerging market exposure in energy production, particularly in China, should allow for sustainable long-term secular growth. Furthermore, continued low natural gas prices could produce a structural shift toward the use of Industrial Gas Turbines – thus benefiting PCP. We expect the company to generate ~15% earnings growth over the next three years (FY10A-13E) & believe 5-year organic EPS power of ~$10.70 is possible."

PCP closed Friday at $141.21.