On Monday, BofA Securities began coverage on Centuri Holdings Inc (NYSE: CTRI), issuing a Neutral rating and setting a price target of $26.00 for the company's shares. Centuri, which was recently spun off from Southwest Gas (NYSE:SWX) in April, is currently recognized as the third-largest utility services provider in North America. The company caters to electric and gas companies, collectively serving approximately 100 million customers across the continent.
Centuri Holdings has been described as a conglomerate of regional utility services firms. Now operating independently, it is identified as having considerable opportunities to streamline its cost base, increase its share of customer spending, and engage in mergers and acquisitions as its leverage decreases.
The BofA Securities report highlighted Centuri's numerous long-term growth drivers and potential for medium-term margin improvements. However, it also noted that the realization of the company's progress and potential might be gradual and is yet to be fully actualized.
Centuri's separation from Southwest Gas has positioned it to independently pursue its growth strategy. This move could enable the utility services provider to more effectively optimize its operations and expand its business through strategic initiatives.
The price target of $26.00 reflects BofA Securities' current valuation of Centuri Holdings based on the company's market prospects and operational strategies.
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