Kodiak Gas Services (NYSE:KGS) Hits New 52-Week High - Here's Why

Key Points

• Shares hit a new 52-week high, trading as high as $63.99 and last at $63.43, while analysts’ consensus is a Moderate Buy with an average target of $55.86 and several firms (RBC, Barclays) raising price targets recently.
• Q4 results were mixed: EPS missed expectations ($0.40 vs. $0.53) but revenue rose 7.6% to $332.87M; the stock carries an elevated valuation (market cap $5.46B, PE 73.03) despite a PEG of 0.89.
• Kodiak pays a quarterly dividend of $0.49 (annualized $1.96) for a ~3.1% yield, but the payout ratio is very high at 225.29%, raising sustainability concerns.

Shares of Kodiak Gas Services, Inc. (NYSE:KGS - Get Free Report) hit a new 52-week high during mid-day trading on Monday . The company traded as high as $63.99 and last traded at $63.4320, with a volume of 616 shares traded. The stock had previously closed at $63.25.

Analyst Ratings Changes

KGS has been the subject of a number of research analyst reports. Barclays raised their target price on Kodiak Gas Services from $49.00 to $60.00 and gave the stock an "overweight" rating in a research note on Thursday, March 5th. Zacks Research cut Kodiak Gas Services from a "hold" rating to a "strong sell" rating in a research report on Tuesday, April 7th. Royal Bank Of Canada raised their target price on Kodiak Gas Services from $45.00 to $64.00 and gave the company an "outperform" rating in a research report on Thursday, March 19th. Mizuho lifted their price objective on Kodiak Gas Services from $36.00 to $44.00 and gave the stock an "outperform" rating in a report on Tuesday, January 20th. Finally, Weiss Ratings reiterated a "hold (c)" rating on shares of Kodiak Gas Services in a report on Monday, December 29th. Seven investment analysts have rated the stock with a Buy rating, one has assigned a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat.com, the company has an average rating of "Moderate Buy" and an average target price of $55.86.

Kodiak Gas Services Trading Up 0.5%

The company has a market cap of $5.46 billion, a PE ratio of 73.03, a price-to-earnings-growth ratio of 0.89 and a beta of 0.96. The company has a quick ratio of 0.57, a current ratio of 0.84 and a debt-to-equity ratio of 2.12. The business has a 50-day simple moving average of $56.14 and a 200-day simple moving average of $43.44.

Kodiak Gas Services (NYSE:KGS - Get Free Report) last announced its earnings results on Wednesday, February 25th. The company reported $0.40 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.53 by ($0.13). Kodiak Gas Services had a net margin of 6.16% and a return on equity of 11.55%. The firm had revenue of $332.87 million during the quarter, compared to analysts' expectations of $330.95 million. During the same period in the previous year, the firm earned $0.21 EPS. The firm's revenue for the quarter was up 7.6% compared to the same quarter last year. On average, analysts predict that Kodiak Gas Services, Inc. will post 1.12 EPS for the current fiscal year.

Kodiak Gas Services Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Friday, February 20th. Investors of record on Friday, February 13th were paid a dividend of $0.49 per share. The ex-dividend date was Friday, February 13th. This represents a $1.96 dividend on an annualized basis and a dividend yield of 3.1%. Kodiak Gas Services's payout ratio is presently 225.29%.

Insider Activity

In related news, insider Pedro R. Buhigas sold 13,942 shares of the business's stock in a transaction on Thursday, March 19th. The shares were sold at an average price of $55.73, for a total transaction of $776,987.66. Following the completion of the transaction, the insider owned 42,723 shares in the company, valued at approximately $2,380,952.79. The trade was a 24.60% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, Director Alexander Newsom Darden bought 5,000 shares of the stock in a transaction that occurred on Friday, March 13th. The shares were purchased at an average price of $54.75 per share, with a total value of $273,750.00. Following the purchase, the director owned 5,000 shares of the company's stock, valued at approximately $273,750. This represents a ∞ increase in their position. The SEC filing for this purchase provides additional information. In the last quarter, insiders have acquired 11,433 shares of company stock valued at $624,360 and have sold 58,673 shares valued at $3,269,110. 0.64% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Kodiak Gas Services

Several large investors have recently bought and sold shares of KGS. Vanguard Group Inc. boosted its stake in Kodiak Gas Services by 33.8% in the fourth quarter. Vanguard Group Inc. now owns 6,170,360 shares of the company's stock valued at $230,771,000 after acquiring an additional 1,559,172 shares in the last quarter. Invesco Ltd. boosted its stake in Kodiak Gas Services by 29.5% in the third quarter. Invesco Ltd. now owns 6,305,789 shares of the company's stock valued at $233,125,000 after acquiring an additional 1,436,443 shares in the last quarter. CIBC Private Wealth Group LLC boosted its stake in Kodiak Gas Services by 3,046.3% in the fourth quarter. CIBC Private Wealth Group LLC now owns 1,471,663 shares of the company's stock valued at $55,040,000 after acquiring an additional 1,424,888 shares in the last quarter. Zimmer Partners LP boosted its stake in Kodiak Gas Services by 45.7% in the fourth quarter. Zimmer Partners LP now owns 4,271,553 shares of the company's stock valued at $159,756,000 after acquiring an additional 1,339,849 shares in the last quarter. Finally, Eagle Global Advisors LLC acquired a new position in Kodiak Gas Services in the fourth quarter valued at $39,741,000. Institutional investors and hedge funds own 24.95% of the company's stock.

About Kodiak Gas Services

Kodiak Gas Services, Inc operates contract compression infrastructure for customers in the oil and gas industry in the United States. It operates in two segments, Compression Operations and Other Services. The Compression Operations segment operates company-owned and customer-owned compression infrastructure to enable the production, gathering, and transportation of natural gas and oil. The Other Services segment provides a range of contract services, including station construction, maintenance and overhaul, and other ancillary time and material-based offerings.

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