UPDATE: Wunderlich Securities Reiterates On Vertex Energy On Revised Assumptions

In a report published Monday, Wunderlich Securities analyst Michael E. Hoffman reiterated a Buy rating on

, and raised the price target from $10.00 to $12.00. In the report, Wunderlich Securities noted, “We reiterate our Buy rating and are increasing our price target on Vertex Energy (VTNR) to $12.00. We had the opportunity to revisit our model with VTNR and concluded that our top-line growth rate and margin assumptions for the integration of Omega were too conservative in 2015. We tweaked the top-line from 2.5% to 5% beginning in 2016 and squeezed out an additional $6mm in EBITDA in 2015 and then had it gradually improve from there. "We assume the NOL is fully absorbed by the close of 2015 and VTNR is a full tax payer in 2016. Despite that cash hit, 10-year FCF CAGR is 21% with the long-term FCF rate at 4.5%. Upside comes from better organic growth and more margin improvement. Currently, we have EBITDA rising from 6.9% in 2014 to 11.4% in 2016 and then peaking at 15% by 2030.” Vertex Energy closed on Friday at $9.81.