Kaiser Aluminum Corporation (KALU) PT Raised to $100 at Benchmark

Benchmark analyst Josh Sullivan raised the price target on Kaiser Aluminum Corporation (NASDAQ: KALU) to $100.00 (from $84.00) while maintaining a Buy rating.

The analyst commented: "We are moving valuation base one year forward for KALU with our PT increasing to $100 (8.8x FY25 EV/EBITDA) from $84 (8.8x FY24). 1Q:24 marked a normalization of
general conditions for KALU while improved cost controls drove results. Further, the destocking cycle in Packaging as well as General Engineering came to an end. KALU’s installation of the new higher margin roll coat #4 line at Warrick is on pace, the new metal sourcing strategy is playing out faster than expected, and planning for expansion of Trentwood to facilitate long-term aerospace build rates continues. KALU is more leverage to Boeing on the aerostructure side, and while 737 production rates remain at low levels, communication to the supply chain has been to not structurally slow down over fears it would be challenging to ramp back up. Further, F-35 international delivery flow and business jet activity are KALU’s current drivers of segment. With packaging and general engineering destocking having come to an end, KALU should see some incremental base line support as well."

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