Ceco Environmental price target raised to $40 from $34 at Craig-Hallum

Craig-Hallum analyst Aaron Spychalla raised the firm’s price target on Ceco Environmental (CECO) to $40 from $34 and keeps a Buy rating on the shares. The firm notes Ceco has completed the acquisition of Profire Energy, a provider of combustion/burner management control solutions for gas-fired applications, for $123M. The largest acquisition made to-date, Craig-Hallum thinks it follows its M&A playbook of expanding its addressable market and being additive to margins, with the potential for cost and commercial synergies to result in a 7.0-7.5 turns EBITDA purchase price. The firm remains optimistic on the outlook for record Q4 2024 orders driven by its emissions solutions for growing power generation needs, which should continue into 2025 and help provide confidence in the outlook for double-digit organic growth in the coming years.