DT Midstream (DTM) PT Raised to $76 at Citi

Citi analyst Spiro Dounis raised the price target on DT Midstream (NYSE: DTM) to $76.00 (from $62.00) while maintaining a Neutral rating.

The analyst comments "We lift our valuation to $76 from $62 to reflect three factors: (1) base business outperformance; (2) higher terminal value due to power gen demand growth; and (3) new near-term growth opportunities. We now expect DTM to exceed the high-end of its 2024 guidance range and expect management to upgrade guidance with the 3Q24 call. We also lift 2025+ EBITDA estimates on the follow-through impact. With respect to the terminal value, we reduce our terminal decline rate by 50bps to be in-line with large cap peers like WMB and KMI who are also expected to benefit from renewed power gen demand growth. DTM is under confidentiality agreements now, which appears to indicate the near-term potential to announce an initial suite of data center projects. Finally, DTM announced new commercial agreements, growth in clean fuels, and appears poised to FID CCS and LEAP Phase 4."

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