KeyBanc upgrades Helios Tech stock rating on self-help potential

Investing.com - KeyBanc upgraded Helios Technologies (NYSE:HLIO) from Sector Weight to Overweight on Thursday, setting a price target of $40.00 as the firm sees potential in the company’s new leadership and strategy. According to InvestingPro data, the stock has declined over 30% in the past six months, while maintaining strong fundamentals with a current ratio of 2.78, indicating robust liquidity.

The upgrade comes as KeyBanc expresses confidence that short-cycle markets have reached a bottom, positioning Helios to benefit from an eventual market recovery with significant margin leverage potential. The firm acknowledges that margin challenges from excess capacity will likely continue in the near term. Notably, the company has maintained dividend payments for 29 consecutive years, demonstrating resilient financial management through market cycles.

KeyBanc was encouraged by recently appointed CEO Sean Bagan’s messaging around refocusing the company’s go-to-market approach and implementing a more rigorous evaluation of Helios’ portfolio and operational footprint. The firm sees these strategic shifts as potential catalysts for improvement even before broader market conditions improve.

With Helios stock currently trading at 9.9 times KeyBanc’s next-twelve-month EV/EBITDA estimate, which falls below the company’s historical range of 10-16 times, the firm considers current price levels an attractive entry point for investors.

KeyBanc views Helios as being in the early stages of a self-help story, suggesting the company has internal improvement opportunities that could drive performance regardless of external market conditions.

In other recent news, Helios Technologies reported its first-quarter 2025 financial results, exceeding analysts’ expectations. The company achieved an earnings per share (EPS) of $0.44, surpassing the forecast of $0.36, and generated revenue of $195.5 million, beating the anticipated $187.73 million. Additionally, Helios Technologies announced the continuation of its quarterly cash dividend, maintaining a payout of $0.09 per common share, which underscores its long-standing tradition of consistent shareholder returns. The company’s annual shareholders meeting saw the re-election of Doug Britt and Diana Sacchi, and the election of Sean Bagan, reflecting shareholder support for the current board. Furthermore, Helios Technologies appointed Ian Walsh to its Board of Directors, bringing extensive experience from the aerospace and defense industries. The company also confirmed the ratification of Grant Thornton LLP as its independent registered public accounting firm for the fiscal year ending January 3, 2026. These developments come amid Helios’ efforts to manage market uncertainties, including potential tariff impacts, while maintaining its focus on innovation and market expansion.

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