SPX Technologies (SPXC) is benefiting from its core platforms with steady cash flows but the stock needs catalyst as its data center exposure is already priced into valuation, BofA Securities said in a note Wednesday.

"As the stock is trading in line with peers on its PO, for us to get materially constructive we would look for either a catalyst (seeing cash deployed into a deal) or a pullback in the stock," the report said. PO refers to price objective.

The note said SPX is a specialist player with strong M&A history, with its HVAC and Detection & Measurement products generating steady cash flows.

"We view SPX Technologies as a capital allocation story," it said, pointing to its acquisitions of 16 companies since 2015.

BofA initiated coverage of SPX with a neutral rating and a $202 price objective.

Price: 186.91, Change: -1.41, Percent Change: -0.75