SPX Technologies A Strong Buy with Steady Organic Growth Outlook, Says Analyst - SPX Techs (NYSE:SPXC)

William Blair analyst Lawrence De Maria re-initiated coverage on SPX Technologies Inc SPXC with an Outperform rating.
The analyst sees the company's internal operating improvements, strong balance sheet and value-accretive acquisition strategy, and steady organic growth outlook as favorable factors for valuation upside over time.
The analyst believes SPXC has successfully transformed into a more simplified and cohesive company through 12 higher-margin business acquisitions, the sale of cyclical businesses, and the management of legacy liabilities.
SPXC is presently benefiting from strong secular tailwinds, such as a large pipeline of infrastructure upgrades, a regulatory push toward energy efficiency, and government stimulus.
The analyst sees that SPXC has efficiently increased its segment margins despite supply chain disturbances and labor shortages.
De Maria expects the Infrastructure Investment and Jobs Act (IIJA) of $1.2 trillion, set to accelerate through 2026, to support top-line growth across 75% of SPXC's portfolio.
SPXC is well positioned to exceed its 2025 revenue target of $2 billion, assuming 5% organic growth and an annual accretive M&A of $100 million.
De Maria expects substantial margin expansion over the next few years, with HVAC business exceeding the upper end of the company's long-term margin target of 14% to 16% and D&M business margins reaching the lower end of SPXC's long-term target range of 22% to 24%, on favorable product mix.
Price Action: SPXC shares are trading lower by 0.22% at $66.67 on last checked Monday.

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