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On Thursday, Citi analyst Scott Gruber increased the price target for Chart Industries (NYSE:GTLS) to $225 from the previous target of $190, while maintaining a "Buy" rating on the stock. The adjustment follows a significant rise in the company’s share value, which has seen an approximate 60% surge since the announcement of third-quarter earnings in early November. According to InvestingPro data, the stock has delivered an impressive 73.09% return over the past six months, with current analysis suggesting the stock remains undervalued relative to its Fair Value.
Chart Industries has captured investor confidence through robust margin and free cash flow (FCF) performance, coupled with conservative guidance and a clearer understanding of the company’s growth drivers. The company boasts a perfect Piotroski Score of 9 on InvestingPro, indicating strong financial health, with revenue growing 46.41% in the last twelve months. Despite the stock currently trading at a roughly 10.5 times 2025 estimated enterprise value to earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) multiple, Gruber sees room for further appreciation. He notes that Chart Industries is still trading at a discount compared to its industrial peers, which average around a 14.5 times multiple.
The new price target of $225 is based on an approximately 12 times 2025 estimated EV/EBITDA multiple, which is expected to compress to around 10 times in 2026. As investors look ahead to the company’s earnings, scheduled for February 26th according to InvestingPro, Gruber highlights the importance of aftermarket intake, which is critical for meeting management’s high single-digit to 10% revenue growth target for 2025. Additionally, insights into the margin outlook for the Specialty and Heat Transfer Solutions (HTS) segments will be crucial, especially considering the lower expected return on sales (RSL) margins. With 12 additional ProTips and comprehensive financial metrics available on InvestingPro, investors can gain deeper insights into Chart Industries’ growth potential and market position.
In other recent news, Chart Industries, a manufacturer specializing in fabricated plate work, has been making notable strides. The company has secured a new employment agreement with CFO Joseph R. Brinkman, aligning with the terms of other senior executives and replacing Brinkman’s previous severance agreement. This new agreement introduces non-competition and non-solicitation clauses to protect the company’s interests post-employment.
Chart Industries has also secured a significant order from Bechtel for its Integrated Pre-Cooled Single Mixed Refrigerant (IPSMR®) liquefaction technology and cold boxes. This technology will be utilized for the Louisiana LNG project, operated by Woodside (OTC:WOPEY) Energy Group Ltd and managed by Bechtel Energy Inc.
Stifel analysts have maintained their Buy rating on Chart Industries’ stock, citing the company’s momentum and appealing valuation. They anticipate that 2025 will be a significant year for the company in terms of LNG order activity.
Additionally, Chart Industries has announced a share repurchase program, authorizing the repurchase of up to $250 million worth of its common stock. The company has also concluded agreements to terminate warrant transactions related to its convertible notes, finalizing the obligations under the previous arrangements with the Option Counterparties. These recent developments reflect the company’s ongoing efforts to maintain competitive and fair employment practices and to capitalize on the expected increase in LNG orders.
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