Tuesday, an analyst from Citi updated their assessment of Solaris Oilfield Infrastructure (NYSE:SOI), raising the shares price target to $8.50 from the previous $8.25, while maintaining a Neutral rating.
The revision is based on preliminary forecasts for the first quarter and the full year of 2024, with an expected adjusted EBITDA of approximately $23 million and $91 million, respectively. These figures align with the current consensus average. Solaris Oilfield's quarterly adjusted EBITDA is projected to stay in the low-$20 million range, following the company's guidance of relatively flat system utilizations throughout the year.
The price target adjustment reflects a valuation change, with the multiple increasing to approximately 4.5 times from the prior 4.0 times. This change is part of a valuation roll to 2025, anticipating some improvement in the multiple as the end market for Solaris Oilfield's services is expected to begin expanding once more.
Solaris Oilfield Infrastructure's price target update and maintained rating by Citi indicate the firm's expectation of the company's steady financial performance in the near term, coupled with a cautiously optimistic outlook on the market's growth prospects.
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