RBC lifts Atlas Energy stock target to $28, cites growth potential

The firm’s positive outlook for Atlas (NYSE:ATCO) Energy Solutions remains steady, with expectations that the company’s recent strategic moves will enhance its market position and financial performance in the near future. The company currently offers an attractive dividend yield of 4.09% and has generated $261.94 million in EBITDA over the last twelve months, underlining its operational strength. The company currently offers an attractive dividend yield of 4.09% and has generated $261.94 million in EBITDA over the last twelve months, underlining its operational strength.

Keith Mackey of RBC Capital lauded Atlas Energy’s diversification strategy following the company’s acquisition of Moser Energy Systems for $220 million. The transaction is seen as a move that grants Atlas Energy access to a new growth vertical, which RBC Capital believes was secured at a reasonable valuation multiple. With a market capitalization of $2.72 billion and impressive revenue growth of nearly 49% in the last twelve months, the company has demonstrated strong execution capabilities.

Atlas Energy’s differentiated growth profile was highlighted as a key factor in maintaining the Outperform rating. The firm’s position as a low-cost sand provider contributes to its strong margins, and analysts anticipate an upcoming free cash flow (FCF) inflection point. The $28 price target set by RBC Capital is based on a sum-of-the-parts valuation approach, which aims to capture the intrinsic value of Atlas’ Proppant mines and Logistics growth trajectory.

In comparison to its peers, Atlas Energy Solutions trades at estimated 2025/2026 enterprise value to EBITDA (EV/EBITDA) multiples of 7.4 and 5.9 times, respectively. This is above the North American coverage group average of 4.8 and 4.6 times. RBC Capital’s analysis suggests that the company’s current valuation reflects its unique market position and future earnings potential.

The firm’s positive outlook for Atlas Energy Solutions remains steady, with expectations that the company’s recent strategic moves will enhance its market position and financial performance in the near future.

In other recent news, Atlas Energy Solutions has been making strategic moves to diversify its portfolio and enhance its offerings in the power solutions sector. The company’s recent acquisitions of Moser Acquisitions, Inc. and a distributed power business for $220 million each have been met with varied responses from analysts. Citi and Stephens analysts have adjusted their price targets for Atlas Energy to $24 and $29 respectively, while maintaining neutral and overweight stock ratings.

These acquisitions are expected to close by the end of the first quarter of 2025. The company has also reported a 6% quarterly increase in revenue, reaching $304 million, and announced a dividend increase to $0.24 per share and a $200 million share repurchase program, indicating confidence in its financial health.

Despite these positive developments, Atlas Energy has received a series of downgrades from major firms including BofA Securities, Goldman Sachs, and Citi, shifting the stock rating from Buy to Neutral due to concerns over the company’s financial forecasts. Atlas Energy maintains strong fundamentals, with revenue reaching $925.76M and year-over-year growth of 48.67%. These are the recent developments for Atlas Energy Solutions.

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