NPK International (NPKI) PT Raised to $18 at H.C. Wainwright

H.C. Wainwright analyst Amit Dayal raised the price target on NPK International (NYSE: NPKI) to $18.00 (from $12.00) while maintaining a Buy rating.

The analyst commented: 'We are increasing our price target on NPK International to $18 from $12. We believe: (1) the company is positioned to continue benefiting from growing utility spend on power infrastructure expansion over the next three to five years; and (2) the company's financial results should be reflective of these trends. The company's healthy market position is further supported by expected improvements in adjusted EBITDA margins, strong cash generation partly supported by net operating losses carried forward (NOLs), and a solid balance sheet with access to additional borrowing capacity (if needed). We believe the demand outlook for the company's offerings remain well-supported with the level of activity underway with respect to the macro power infrastructure build-out. Rental revenues comprised roughly 64% of total revenues, supported by investments in growing the rental fleet and general demand strength. In line with this, the company has revised its outlook for 2025 revenues, adjusted EBITDA, and capex to $268-272M, $71-74M, and $45-50M from $250-260M, $68-74M, and $35-40M previously. The higher capex should be expected to partly be dedicated to continue ramping the available rental fleet. The slight weakness in the quarter stemmed from gross margins declining sequentially to around 32% from 37% in 2Q25. Management attributed this to short-notice changes on the rental front that created short-term operational inefficiencies. The company expects margins to trend back to mid-30% levels going forward. Efforts to implement operational efficiencies remain in place and management is targeting mid-teen revenue percentage level for operational costs in 2026. Reiterate Buy rating."

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