In a recent filing with the Securities and Exchange Commission, Frontier TopCo Partnership, L.P. reported the sale of 6,565,217 shares of Kodiak Gas Services, Inc. (NYSE:KGS) common stock. This transaction, which took place on November 14, 2024, was executed at an average price of $33.2063 per share, amounting to a total of approximately $218 million.
Following this sale, Frontier TopCo Partnership holds 44,434,783 shares of Kodiak Gas Services. Additionally, on November 18, 2024, the company reported a further disposition of 434,783 shares, which were repurchased by Kodiak Gas Services at a price of $34.50 per share, totaling around $15 million.
These transactions reflect significant activity by Frontier TopCo Partnership in its holdings of Kodiak Gas Services, a company specializing in natural gas transmission. The shares are held indirectly by Frontier TopCo Partnership through its general partner, Frontier TopCo GP, LLC, with EQT (ST:EQTAB) Fund Management S.a r.l. having control over the investment decisions.
In other recent news, Kodiak Gas Services reported robust earnings and revenue results, with an EBITDA of $154 million closely aligning with expectations, and a projected run-rate EBITDA of $162 million after adjustments for non-recurring items. The company increased its quarterly cash dividend by 8% to $0.41 per share and authorized a $50 million stock repurchase program. Additionally, Kodiak initiated a public offering of approximately 6.14 million shares by an affiliate of EQT Infrastructure funds and plans to repurchase $15 million of its common stock from the selling stockholder.
The company has also filed a prospectus supplement allowing certain selling stockholders to resell up to 5,562,273 shares of its common stock. In terms of analyst coverage, RBC Capital Markets maintained its Outperform rating on Kodiak shares and increased the company's price target to $40.00. Mizuho (NYSE:MFG) initiated coverage on the stock with an Outperform rating and a price target of $36.00, while Citi also initiated coverage on the company, assigning a Buy rating. These are among the recent developments for Kodiak Gas Services.
InvestingPro Insights
The recent stock sales by Frontier TopCo Partnership align with several key metrics and trends observed in Kodiak Gas Services' (NYSE:KGS) financial performance. According to InvestingPro data, Kodiak Gas Services has demonstrated strong growth, with a revenue increase of 33.77% over the last twelve months as of Q3 2024, reaching $1075.77 million. This growth trajectory is further emphasized by the company's impressive 40.55% quarterly revenue growth in Q3 2024.
Despite the large-scale stock sale, Kodiak Gas Services appears to be in a robust financial position. The company boasts a healthy gross profit margin of 59.86% and an operating income margin of 27.17% for the last twelve months. These figures suggest that Kodiak Gas Services is effectively managing its costs while expanding its operations.
InvestingPro Tips highlight that Kodiak Gas Services has shown a "Strong return over the last month" and is "Trading near 52-week high," with the stock price currently at 99.34% of its 52-week high. This positive momentum is reflected in the company's year-to-date price total return of 92.07% and a one-year price total return of 110.75%.
However, investors should note that the stock is "Trading at a high earnings multiple," with a P/E ratio of 137.84. This valuation suggests that the market has high growth expectations for Kodiak Gas Services, which may explain the insider's decision to sell a portion of their holdings.
For readers interested in a more comprehensive analysis, InvestingPro offers 12 additional tips for Kodiak Gas Services, providing a deeper understanding of the company's financial health and market position.
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