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Motorola is a defensive growth story that has plenty of upside potential, Morgan Stanley says

Motorola could see big gains from here, according to Morgan Stanley. Analyst Erik Lapinski upgraded shares of Motorola to overweight from equal weight, saying in a Monday note that the telecommunications company is attractive in the current market and could reach $300 a share in two years in its bull case. “Our analysis shows the $300 Bull case valuation on MSI on a 2-year view is achievable (20% 2-year compound return) and offers defensive earnings growth,” Lapinski wrote. “Recent pullback in MSI and a market backdrop that makes a more defensible earnings growth story screen attractive creates an opportunity to step in with upside potential.” Shares of Motorola Solutions have nearly 15% upside from Friday’s closing price based on Morgan Stanley’s base case of a $240 price target. They have nearly 50% upside based on Morgan Stanley’s $300 bull case. Analysts believe the bull case is supported by a strong cycle for Motorola’s land-mobile-radio (LMR) product, its expansion into video surveillance technology, and the company’s operating efficiency. “We were believers in the Bull case when we initiated on MSI with an EW rating last year, but thought it would take time to achieve. Now a year later and preferring a more defensible earnings growth story, we upgrade to OW,” Lapinski wrote. Shares of Motorola Solutions jumped 5% in Monday premarket trading. –CNBC’s Michael Bloom contributed to this report.

Greg Brown, Chairman and CEO of Motorola, speaks at CNBC’s Evolve conference in Chicago on Sept. 24, 2019.
Jeff Schear | CNBC

Motorola could see big gains from here, according to Morgan Stanley.