Konecranes Gains as HSBC Sees Potential in U.S.: Helsinki Mover

Konecranes Oyj, the Finnish maker of lifting equipment, climbed in Helsinki trading after HSBC Holdings Plc. said benefits from the long-term U.S. manufacturing recovery offset any short-term risks.

Konecranes advanced as much as 3.7 percent to 22.53 euros, the highest in a week and added 3.5 percent at 1:07 p.m. in the Finnish capital. It was the biggest intraday climb on the Nasdaq OMX Helsinki 25 Index. Trading volume was about 39 percent of the three-month daily average.

Improved competitiveness and lower energy prices in the U.S. resulting from the shale gas boom may attract industrial investments to the country over the coming decade, making Konecranes a “key beneficiary,” Juergen Siebrecht and other analysts at HSBC said in a note to clients today. HSBC upgraded its recommendation on Konecranes to neutral from underweight and raised the 12-month price estimate to 23 euros from 21 euros.

“Industrial cranes are usually a key necessary investment if manufacturing is being built up,” Siebrecht said.

Shale-gas production has contributed to a widening gap between energy costs incurred by industrial companies in the U.S. and the European Union. While the EU’s dependence on oil and gas imports is set to increase to more than 80 percent until 2035, the U.S. is on its way to become a net exporter, according to the International Energy Agency.

Konecranes warned on June 19 it will earn less profit this year than previously forecast, citing the “unsatisfactory” profitability of its equipment unit. The unit makes cranes and container-handling machinery and accounts for about 60 percent of sales. The company earned 33 percent of its revenue from the Americas last year.

“Dull European and China markets remain risk factors,” Siebrecht said. Still, they “seem largely reflected in the lower post-warning share price.”

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