Montrose Environmental named ‘2025 Top Pick’ at Needham

Needham lowered the firm’s price target on Montrose Environmental (MEG) to $39 from $44 but keeps a Buy rating on the shares. The firm is also naming the stock its “top pick for 2025” and add the name to the Needham conviction list, replacing Teledyne (TDY). Shares have significantly underperformed the peer group and the broader market since the Supreme Court’s Loper Bright ruling in late June, reversing the long-standing practice of courts deferring to federal agencies’ interpretations of federal statutory provisions, making the risk-reward opportunity “compelling” at current prices, the analyst tells investors in a research note. Needham also contends that concerns about Montrose’s prospects looking to 2025 are “overblown” and also believes that management’s plan to pause M&A temporarily and redeem the A-2 preferred stock will provide a clearer view of the company’s organic growth, financial strength and cash flow generation capability.