DA Davidson maintains Buy on Modine stock, target at $135

Published 24/05/2025, 11:56
DA Davidson maintains Buy on Modine stock, target at $135

On Friday, DA Davidson reiterated a Buy rating on Modine Manufacturing (NYSE:MOD) with a price target of $135.00, well above the current price of $89.81. According to InvestingPro data, the stock has experienced significant volatility, with a -14% return over the past week, though maintaining strong profitability with a gross margin of 25%. The firm’s analysis highlighted Modine’s continued success in the data center (DC) market, noting the company’s outgrowth in the fourth fiscal quarter of 2025. Modine is reportedly expanding its customer base, now including a potential fifth major hyperscale client, due to its technology being well-received by top DC deployers.

The positive outlook is slightly moderated by the current cyclical downturn in the vehicular markets within the Powertrain (PT) segment and the increased growth investment spending within the Climate Solutions (CS) segment. Despite these challenges, Modine’s balance sheet is considered robust enough to support additional mergers and acquisitions, with progress in divestitures also being acknowledged. InvestingPro analysis confirms this financial strength, showing liquid assets exceeding short-term obligations with a healthy current ratio of 1.78 and moderate debt levels.

DA Davidson’s stance comes after a detailed review of Modine’s performance and strategic moves. The research firm has chosen to maintain its adjusted EBITDA estimates for the company. The reaffirmation of the Buy rating and the $135 price target reflects confidence in Modine’s market position and financial health.

Modine’s stock performance will continue to be watched closely by investors, as the company navigates through the complexities of its diverse markets. The company’s ability to grow its presence in the data center sector while managing investments and potential acquisitions will be crucial factors in achieving the expectations set by analysts.

In other recent news, Modine Manufacturing Company reported impressive financial results for the fourth quarter of fiscal year 2025, exceeding analysts’ expectations. The company achieved an earnings per share (EPS) of $1.12, surpassing the forecasted $0.96, and reported revenue of $647.2 million, which exceeded the anticipated $634.49 million. Modine announced a $100 million stock buyback program, reflecting confidence in its financial stability. Despite these positive earnings and revenue figures, the company’s stock experienced a decline in after-hours trading. Modine’s Climate Solutions segment showed robust growth, driven by a 7% increase in sales, while the adjusted EBITDA margin for the full year improved significantly to 15.2%. The company also reduced its net debt by 92% to $279 million, showcasing effective financial management. Looking ahead, Modine projects sales growth between 2% and 10% for fiscal 2026, with particular strength anticipated in the data center market. Analyst firms have not issued any recent upgrades or downgrades, but the company’s strategic initiatives and market performance continue to be closely monitored by investors.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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