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Lake Street Capital Markets initiated coverage on TAT Technologies (NASDAQ:TATT) Wednesday with a Buy rating and a price target of $37.00. The company, currently trading at $26.82 with a market capitalization of $337 million, has demonstrated strong momentum with a 78% return over the past year. According to InvestingPro, the company maintains a "GOOD" overall financial health score.
The aerospace service provider is described by Lake Street as "a classic overlooked microcap investment opportunity" with a consistently growing backlog that positions the company for above-average revenue and earnings growth compared to industry peers. This assessment is supported by the company’s impressive 31% revenue growth in the last twelve months and a favorable PEG ratio of 0.31, indicating attractive valuation relative to growth potential.
TAT Technologies provides OEM and MRO (original equipment manufacturing and maintenance, repair, and overhaul) services to the global aerospace sector, with Lake Street noting the company is well-positioned for "growth in excess of peers for years to come."
Lake Street believes that despite TAT Technologies’ strong historical stock performance, the company has further upside potential through continued execution and new contract wins that could drive the stock beyond its current market average multiple.
The $37 price target represents significant upside from TAT Technologies’ current trading price, reflecting Lake Street’s confidence in the company’s growth trajectory within the aerospace services market.
In other recent news, TAT Technologies reported strong first-quarter 2025 earnings, with an adjusted EBITDA margin of 13.5%, surpassing Benchmark’s expectations. The company also initiated a public offering of 1,625,000 ordinary shares and a secondary offering of 2,525,000 shares by selling shareholders, with the proceeds intended for general corporate purposes. Benchmark raised its price target for TAT Technologies to $36.00, maintaining a Buy rating following the company’s impressive earnings performance. Truist Securities also initiated coverage with a Buy rating and a $35.00 price target, highlighting TAT Technologies’ potential for above-market growth. Furthermore, TAT Technologies secured a significant maintenance, repair, and overhaul (MRO) partnership with an international cargo carrier, valued between $45 million and $55 million over five years. This contract emphasizes the company’s growing presence in the auxiliary power unit (APU) market. Benchmark noted TAT’s recent equity offering as a strategic move to support its expanding backlog. Analysts at both Benchmark and Truist Securities view TAT Technologies as a promising player in the aerospace component repair sector.
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