Mizuho Securities analyst Gabe Moreen has maintained their bullish stance on KNTK stock, giving a Buy rating on February 27.
Gabe Moreen has given his Buy rating due to a combination of factors that highlight Kinetik’s potential for long-term growth despite recent setbacks. The company’s fourth-quarter results for 2024 were below expectations, primarily due to maintenance issues impacting volumes and resulting in negative pricing. However, management has set ambitious targets, including a 10% compound annual growth rate in adjusted EBITDA over the next five years, aiming for a $2 billion run-rate by the end of that period.
Despite the initial negative market reaction, Moreen sees Kinetik’s long-term growth prospects as intact, supported by capital expenditure opportunities and the expiration of NGL contracts, which are expected to drive a higher growth rate compared to peers. The company’s outlook for 2025 and 2026 includes significant contributions from new projects and increased natural gas volume growth, which are anticipated to enhance EBITDA. Additionally, Kinetik’s strategic steps to mitigate future pipeline disruptions and its focus on capital efficiency further bolster confidence in its growth trajectory.
In another report released on February 27, Scotiabank also maintained a Buy rating on the stock with a $62.00 price target.