Joy Global (NASDAQ:JOYG) Driven by Commodity Demand

As commodity demand goes, so will go mining equipment manufacturer Joy Global (NASDAQ:JOYG), and it appears there will be nothing in the short term which will cause commodity demand to fall.

Jefferies (NYSE:JEF) noted, "Management highlighted increased investment by mining companies globally and a shift from brownfield expansions to greenfield opportunities (30-35% increase in cap ex in 2010 and 15-20% higher in 2011)."

They also raised their EPS/revenue estimates for full year 2011 and full year 2012 to $5.15/$3,950M and $5.70/$4,245M from $4.85/$3,800M and $5.60/$4,195M.

With limited supply as measured against increasing commodity demand, Jefferies also sees prices rising, along with margins, which should allow more acquisitions from miners, which will strongly benefit Joy Global.

Jefferies maintains their "Hold" rating on Joy, which was trading at $85.38, down $0.40, or 0.47 percent, as of 11:36 AM EST. They raised their price target on them from $74 to $95.