UPDATE: Williams Financial Group Reiterates Buy Rating, Raises PT on Hornbeck Offshore Services on 4Q Beats
In a report published Friday, Williams Financial Group reiterated its Buy rating on Hornbeck Offshore Services (NYSE: HOS), and raised its price target from $46.00 to $52.00.
Williams Financial Group noted, “HOS reported 4Q EPS ahead of our expectation and that of the Street with focus on cost control and solid contribution from the Downstream segment, which saw 99+% utilization and rates move +6% q/q. Tank Barge retrofit proved timely with HOS more capably participating in the transportation of onshore liquids. The company also announced four more vessels to be built under its current newbuild program, of which at least two will be MPSVs with the option for up to eight such vessels, allowing HOS to better compete in the upcoming UDW construction and intervention cycle. The US GOM asset bifurcation is strengthening with a widening gap between leading edge rates for the 200 and 240 Class vessels, so the company's retrofit program to lengthen six vessels should prove timely, as should the mobilization of four larger vessels back from Brazil. The increase in high‐spec vessels at higher rates is the driver to our estimates, and we are increasing our price target to $52. We are maintaining our Buy rating.”
Hornbeck Offshore Services closed on Thursday at $43.76.
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