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On Friday, Modine Manufacturing (NYSE:MOD), currently trading at $83.43, preserved its Buy rating and $155.00 price target from DA Davidson, following news of a significant $180 million order for DC cooling products. This order is part of a new partnership with a prominent AI infrastructure developer. According to InvestingPro data, the company maintains strong financial health with a current ratio of 1.87, indicating solid liquidity to support new projects.
The company’s announcement after the market closed revealed the substantial order, which DA Davidson views as a positive indicator of the company’s future prospects. The analyst believes that the size of the order points to a likely material impact beyond these initial orders and suggests a strong long-term relationship with the AI infrastructure developer. With a robust EBITDA of $358.4 million and a healthy return on equity of 20%, Modine demonstrates strong operational efficiency.
The analyst expressed confidence in Modine’s ability to execute its business plan, affirming the company’s initial forecast of over 30% growth potential in organic DC revenue by fiscal year 2026. This projection is seen as being consistent with DA Davidson’s existing model and supports the company’s overall outlook through fiscal year 2027.
The endorsement from DA Davidson underscores the firm’s belief in Modine’s strategic direction and its ability to meet the targets set out in the long-term thesis. The analyst’s statement highlights Modine’s execution capabilities, the company’s views on the DC market, and reaffirms the $155 price target. Based on InvestingPro’s comprehensive analysis, Modine appears overvalued at current levels. Discover 14 additional key insights and detailed valuation metrics with an InvestingPro subscription, including access to the company’s in-depth Pro Research Report.
Modine Manufacturing’s recent announcement and the subsequent confirmation of the Buy rating and price target by DA Davidson reflect the company’s potential for growth in the data center cooling market, bolstered by the substantial new order and partnership in the AI sector.
In other recent news, Modine Manufacturing Company reported fiscal third-quarter 2025 results that exceeded both top and bottom-line consensus expectations, driven by strong performance in the data center vertical. The company confirmed its outlook for fiscal year 2025, and Oppenheimer analysts maintained an Outperform rating with a $145.00 price target, citing clear growth visibility for the data center segment over the next 12 to 18 months. Modine also announced plans to open a new manufacturing facility in Chennai, India, by mid-2025 to produce advanced cooling technologies for the data center market and stationary power generation equipment. This expansion aims to meet the increasing demand for data center cooling solutions, particularly in India, Asia, and the Middle East.
Additionally, Modine has announced a leadership change in its Performance Technologies segment, with Adrian I. Peace stepping down as President. Neil D. Brinker, the company’s President and CEO, will oversee the segment on an interim basis. The company is actively pursuing optimization efforts through its 80/20 strategy to enhance profit margins. Despite recent concerns about its DeepSeek technology, Modine’s management has reaffirmed growth projections for the data center segment through fiscal year 2027. The company’s strategic plans remain on course, and the search for a new leader for the Performance Technologies segment is set to begin soon.
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