Street Calls of the Week
Investing.com - Roth/MKM initiated coverage on Legence Corp (NASDAQ:LGN) with a Buy rating and a $41.00 price target on Friday. The company, currently valued at $3.4 billion, is trading near its 52-week high of $34.57, with InvestingPro data indicating the stock is in overbought territory.
The research firm cited tailwinds driving focus on energy-efficient infrastructure as a key factor in its positive outlook for the company, particularly in high-tech data center and life sciences industries, which represent over 50% of Legence’s backlog. With annual revenue of $2.2 billion and a healthy current ratio of 1.66, the company maintains strong liquidity to support its growth initiatives. For more detailed financial insights and additional ProTips, check out InvestingPro.
Roth/MKM projects medium-term growth of over 10% in both revenue and adjusted EBITDA for Legence, noting the company’s business model appears relatively low-risk with 85% of revenue generated under fixed price contracts.
The firm highlighted that approximately 70% of Legence’s projects are valued at less than $10 million each, while retrofit and refurbishment work constitutes about 70% of company activity.
Roth/MKM recommended investors buy Legence stock to capitalize on data center and onshoring tailwinds, along with the broadening customer focus on energy efficiency.
In other recent news, Legence Holdings has seen a series of notable developments. S&P Global Ratings upgraded Legence Holdings to ’B+’ from ’B’ following a significant debt reduction after its initial public offering, with expectations for the company’s adjusted debt to EBITDA ratio to improve over the coming years. BofA Securities initiated coverage on Legence Corp with a Buy rating and set a price target of $35. Wolfe Research also began coverage with an Outperform rating, highlighting the company’s strong position in mechanical, electrical, and plumbing services. Similarly, BTIG initiated coverage with a Buy rating and a $40 price target, emphasizing Legence’s growth in sectors like technology and data centers. Meanwhile, Barclays maintained its Equalweight rating on Legence stock with a $34 price target, continuing its evaluation of the company’s market position and financial performance. These developments reflect a broad interest from analysts in Legence’s potential within its industry.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.