Baker Hughes upped at Piper Sandler on IET potential, not yet at peak orders
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Baker Hughes (NASDAQ:BKR) +1.1% in Thursday's trading as Piper Sandler upgrades shares to Overweight from Neutral with a $43 price target, raised from $34, saying the potential of the company's Industrial and Energy Technology business is "underappreciated."
"With a ~$25B backlog that should grow through the end of the decade, we believe it's too punitive to look just at 2024" in examining the IET business, Piper analyst Luke Lemoine wrote, seeing potential for IET EBITDA margins to expand into the "20% realm" by 2025-26, given volume and mix, cost synergies, and supply chain and product design improvements.
With orders moderating for the next few years but then reigniting in the back part of the decade, Lemoine thinks 2030 revenues could approach $17B in the segment from $7.9B in 2022.
Baker Hughes (BKR) attractively valued, offering up to 40% upside, Leo Nelissen writes in an analysis posted on Seeking Alpha.