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On Monday, Citi analysts reaffirmed a Buy rating for BKV Corp (NYSE: BKV) stock, maintaining a price target of $29. Currently trading at $21.50, BKV has analyst targets ranging from $24 to $33, with a strong consensus Buy recommendation. The decision follows a visit to BKV’s Temple power plants and the new Barnett Zero carbon capture facility.
The analysts noted that the recent finalization of a carbon capture joint venture has allowed BKV’s CEO to focus more on power operations. They highlighted the potential for a long-term power purchase agreement for up to half of the Temple facility’s capacity, which is approximately 750 megawatts. This could increase utilization from around 60% without additional investment.
Barnett Zero, described as an efficient operation, may see reduced capital intensity in future projects due to insights gained from the first site. The analysts suggested that bringing more engineering in-house and reducing compressor capacity could be beneficial.
BKV’s upstream operations continue to show improved efficiency, contributing to lower break-even points. The company is seen as offering unique growth potential in both power and carbon capture sectors, with strong upstream cash flow projected through 2026.
In other recent news, BKV Corporation reported a notable earnings beat for the first quarter of 2025, with adjusted earnings per share reaching $0.41, surpassing analyst expectations. The company also posted a revenue of $216.13 million, reflecting strong operational performance and strategic initiatives in carbon capture and power generation. BKV’s strategic moves include a joint venture with Copenhagen Infrastructure Partners, aimed at enhancing its carbon capture business with a $500 million investment, potentially increasing to $1 billion. The company maintains a low net leverage ratio, signaling robust financial health and positioning it well to meet the growing demand for low-carbon energy solutions.
Additionally, BKV’s power joint venture performed strongly, with a $20 million adjusted EBITDA in the first quarter, driven by favorable weather conditions and higher pricing. The firm has hedged 58% of its 2025 natural gas at $3.44/MMBtu, demonstrating its strategic approach to navigating market fluctuations. Analysts from firms like Barclays (LON:BARC) and Citigroup (NYSE:C) have shown interest in BKV’s future prospects, particularly in its carbon capture projects and the potential for growth in natural gas processing. Despite macroeconomic challenges, BKV remains confident in its ability to deliver value and meet its financial targets.
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