Derek Podhaizer, an analyst from Piper Sandler, has initiated a new Buy rating on Flowco Holdings Inc Class A (FLOC).
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Derek Podhaizer has given his Buy rating due to a combination of factors, including Flowco Holdings Inc’s strong growth potential and unique market position. Flowco is positioned as a key player in the North American production optimization, artificial lift, and methane abatement solutions market, benefitting from the shift of E&Ps towards operational expenditures to enhance production and capital efficiency. The company is expected to achieve double-digit revenue growth in 2025 and 2026, supported by its disruptive HPGL technology and expanding VRU market, which provide cost-effective solutions for emission reduction.
Additionally, Flowco’s impressive EBITDA margins of approximately 40% further strengthen its investment appeal, distinguishing it from its peers in the North American market. This high-margin profile, coupled with its pure-play status in the production phase, positions Flowco as a differentiated investment opportunity, akin to pre-acquisition CHX and WHD. The premium valuation at 9x 2026E EBITDA reflects Flowco’s high-quality and differentiated approach, aligning with Podhaizer’s positive outlook on the company’s future performance.
In another report released today, BMO Capital also initiated coverage with a Buy rating on the stock with a $33.00 price target.