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Investing.com - Stifel has raised its price target on Limbach Holdings (NASDAQ:LMB) to $151.00 from $141.00 while maintaining a Buy rating following the company’s acquisition announcement. The stock has delivered an impressive 143% return over the past year, with InvestingPro data showing the company maintains a "GREAT" financial health score.
Limbach Holdings has acquired Pioneer Power (PPI), a mechanical contractor based in the Twin Cities, Minnesota, for $66.1 million, marking the company’s expansion into a new metropolitan statistical area (MSA).
Pioneer Power provides piping, HVAC, and plumbing capabilities across healthcare, food, power/utility, and petrochemical end markets, with owner-direct relationships (ODR) accounting for a majority of its revenue.
The acquisition is expected to generate approximately $120 million in revenue and $10 million in EBITDA by 2026, representing a purchase multiple of approximately 6.6x EBITDA, or 6.2x when excluding the $4.6 million in real estate assets included in the purchase.
Limbach has also expanded its revolving credit facility to $100 million from the previous $50 million, with Pioneer Power’s contribution to revenue and earnings expected to impact the second half of 2025 outlook, with a guidance update anticipated during second quarter 2025 earnings.
In other recent news, Limbach Holdings reported impressive financial results for the first quarter of 2025, with earnings per share (EPS) of $1.12, significantly surpassing the forecasted $0.43. The company’s revenue also exceeded expectations, reaching $133.1 million against a projected $120.48 million. This strong performance was driven by a notable 22% year-over-year increase in Owner Direct Revenue (ODR), despite a 5% decline in General Contractor Revenue (GCR). Limbach’s adjusted EBITDA for the quarter was $15 million, outperforming the consensus projection of $10 million, with an adjusted EBITDA margin of 11.2%, marking a substantial improvement from the previous year.
Additionally, Limbach Holdings has acquired Pioneer Power for $66.1 million, aiming to strengthen its presence in the Upper Midwest. The acquisition is expected to contribute approximately $120 million in annual revenue and $10 million in adjusted EBITDA beginning in 2026. In corporate governance developments, Limbach’s shareholders recently approved amendments to the company’s Omnibus Incentive Plan, which include provisions for the acceleration of vesting of restricted stock units and performance-based stock units under certain conditions.
Furthermore, Stifel analysts maintained a Buy rating on Limbach Holdings, with a price target set at $141, citing potential for further margin improvements and growth opportunities in the healthcare sector. The analysts expressed optimism about the company’s strategic initiatives and market positioning, highlighting the potential for substantial growth in the coming years. These recent developments reflect Limbach Holdings’ strategic direction and operational success, positioning the company for continued growth and expansion.
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