Wells Fargo has upgraded Chart Industries to overweight from equal weight, with a new price target of $224 per share. This represents a potential increase in value of more than 35% compared to its current price. The stock has already risen by more than 43% since the beginning of the year.
Chart Industries provides equipment for the production and storage of liquefied natural gas and other industrial fuels. The company’s positive steps to reduce debt and sell assets, combined with the growing demand for clean energy, are expected to benefit the company.
In March, Chart Industries acquired gas handler Howden, which has further boosted investor confidence in the company’s outlook for 2023 and 2024. Analyst Roger Read believes that the completion of this acquisition, along with the company’s exposure to the liquefied natural gas industry and its involvement in the energy transition, will support a positive growth trajectory.
Additionally, Chart Industries plans to use its estimated cash holdings of $655 million to $705 million to reduce its debt this year. This is a significant increase from the company’s previous estimate of $275 million to $325 million. The company is also considering potential divestitures to further strengthen its balance sheet.
Overall, Roger Read predicts that Chart Industries will achieve a net leverage ratio of 2.8x by the end of 2024, which falls within the company’s targeted range of 2.5-2.9x. This suggests a positive outlook for the company’s financial position and market performance.
Please note that CNBC’s Michael Bloom provided additional contributions to this report.
Source: energyportal.eu
