UPDATE: Imperial Capital Upgrades EnergySolutions at Buy on Free Cash Flow Yield
Imperial Capital raised its rating on EnergySolutions (NYSE: ES) with an Outperform rating and a $4.75 price target.
Imperial Capital said, "Based on our 2013E EBITDA estimate of $160mn, ES shares trade at a roughly 19% discount to the median valuation of solid and specialty waste disposal peers (see Figures 12 and 13) and a slight 4% premium to median valuation to engineering and construction peers (see Figure 14). Given the company derives more than 50% of its EBITDA from its high-margin (~35%) LP&D business, which is focused on processing and disposal of radioactive waste, we think the shares should trade more consistent with solid/specialty waste peers and believe shares are cheap from this vantage."
EnergySolutions closed at $3.21 on Wednesday.
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