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Investing.com - Susquehanna upgraded Now Inc (NYSE:DNOW) from Neutral to Positive on Friday, setting a price target of $16.00 following the completion of the MRC acquisition. Currently trading at $12.42, InvestingPro data indicates the stock is undervalued with analysts setting targets between $16-$18.
The upgrade reflects Now Inc ’s enhanced position as "a more formidable energy and industrials solutions provider" with a broader and more diversified suite of product offerings in its core end markets, according to Susquehanna.
The firm highlighted several benefits from the acquisition, including increased scale, greater opportunities for growth in energy evolution and industrial markets, and a clean balance sheet that allows for further M&A activity.
Susquehanna also noted that Now Inc maintains solid free cash flow that can be used for debt reduction and shareholder returns, with the company trading at approximately 6.0x 2026 pro forma EBITDA. The company’s current EV/EBITDA ratio stands at 6.06, with a P/E ratio of 14.23.
The research firm expressed confidence in Now Inc’s "seasoned management team with a long history of experience in the sector," which it believes will help unlock profitable growth in the coming years. InvestingPro analysis confirms the company’s solid financial health with a "GOOD" overall score and shows it’s already profitable over the last twelve months. Discover the comprehensive Pro Research Report and 10+ additional ProTips available for DNOW.
In other recent news, DNOW Inc. has completed its acquisition of MRC Global Inc., enhancing its capacity in the energy and industrial sectors. The merger agreement led to the conversion of each MRC Global share into 0.9489 shares of DNOW, and MRC Global’s stock has been delisted from the New York Stock Exchange. Additionally, DNOW reported its third-quarter 2025 earnings, surpassing earnings per share (EPS) expectations with a reported EPS of $0.26 against a forecast of $0.24. This represents an 8.33% surprise in EPS. However, the company fell short on revenue, reporting $634 million compared to the anticipated $635.13 million. Despite the EPS beat, investor concerns were evident due to the revenue miss and other strategic factors. These developments reflect DNOW’s ongoing strategic adjustments and market challenges.
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