Kodiak Gas Services Inc (KGS) PT Lowered to $72 at Mizuho

Mizuho analyst Gabriel Moreen lowered the price target on Kodiak Gas Services Inc (NYSE: KGS) to $72.00 (from $81.00) while maintaining a Outperform rating.

The analyst commented: "We are adjusting estimates ahead of 3Q26 earnings to reflect a more back-weighted Power deployment schedule. We now assume 225 MW of additions in FY27, versus 400 MW previously, reducing near-term earnings while shifting the contributions into FY28-29. We understand there will be a lag between '27 equipment delivery transitioning into revenue-generating capacity. Although distributed generation seems increasingly competitive, it is our view this is a timing adjustment rather than a reduction in the longer-term opportunity. Compression remains constructive, with orders supporting horsepower growth, although elevated lube-oil costs could drive greater margin variability. Separately, redeployment of existing Power assets into the announced 76 MW West Texas contract could temporarily weigh modestly on 4Q26 revenue ahead of an expected 1Q27 start. We lower our PT to $72/sh (from $81/sh) by applying an 8.25x target EV/EBITDA, in-line with compression peers, as we await greater visibility into Power's deployment timing and earnings ramp."

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