Market Overview

BWX Technologies' Navy Orders, 'Underappreciated' Radioisotope Market Underpin This Bull Thesis

Share:
BWX Technologies' Navy Orders, 'Underappreciated' Radioisotope Market Underpin This Bull Thesis

Power generation company BWX Technologies Inc (NYSE: BWXT) was accorded the top notch rating by an analyst at Seaport Global, as he sees a path to well over $100 for the shares of the company.

The Analyst

Seaport Global analyst Josh Sullivan initiated coverage of BWX Technologies with a Buy rating and $72 price target.

The Thesis

BWX Technologies shares have benefited from Navy build schedules, although the next big catalyst for the company is the "underappreciated" medical radioisotope market, Sullivan said in a Wednesday note. (See the analyst's track record here.) 

The medical radioisotope process developed by BWX is "potentially a $1 billion product," Sullivan said. With the analyst's price target of $72 based solely on the company's core business, Sullivan said he sees a path to well over $100 if the company can snag even one-third of the isotope opportunity.

About 80 percent of the BWX portfolio originated in the nuclear operations segment, which is the sole supplier of nuclear reactors for submarines and aircraft carriers to the Navy, according to Seaport Global. 

"Further, BWXT's acquisition of GE Hitachi doubles the nuclear commercial presence in Canada, where 10 reactors are due for refurbishment," Sullivan said. 

Despite the recent Westinghouse acquisition reflecting the interest in the space, the company is not a nuclear power renaissance play, the analyst said. 

The Price Action

Shares of the company are up over 54 percent over the past year, reflecting an improving outlook for some submarine and aircraft builds.

Related Links:

3 Aerospace And Defense Stocks To Buy In 2018

What Defense Firms Spend On Lobbying To Influence Trump

Latest Ratings for BWXT

DateFirmActionFromTo
May 2020B of A SecuritiesUpgradesUnderperformNeutral
Mar 2020SunTrust Robinson HumphreyUpgradesHoldBuy
Feb 2020BairdMaintainsOutperform

View More Analyst Ratings for BWXT
View the Latest Analyst Ratings

 

Related Articles (BWXT)

View Comments and Join the Discussion!

Posted-In: Josh Sullivan military contractors Navy radioisotopesAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
LADCraig-HallumMaintains300.0
ZGTruist SecuritiesMaintains115.0
DDOGMizuhoMaintains116.0
DISMoffettNathansonMaintains136.0
AMAGPiper SandlerUpgrades
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com