Natural Gas Services Group Q2 adjusted EBITDA beats estimates, FY guidance raised

Overview

• NGS Q2 adjusted EBITDA beats analyst expectations, driven by rental revenue growth

• Company raises full-year 2025 adjusted EBITDA guidance to $76-$80 mln

• NGS initiates quarterly dividend and authorizes $6 mln share repurchase program

Outlook

• NGS raises 2025 Adjusted EBITDA guidance to $76 - $80 mln

• Company expects 2025 growth capex of $95 mln to $115 mln

• NGS anticipates 2025 maintenance capex of $11 mln to $14 mln

• Company maintains target return on invested capital of at least 20%

Result Drivers

• RENTAL REVENUE GROWTH - Rental revenue increased 13.3% year-over-year to $39.6 mln, driven by higher horsepower packages and pricing improvements

• HORSEPOWER UTILIZATION - Utilized rental horsepower reached an all-time high of 499,000, supporting revenue growth

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 4 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the oil related services and equipment peer group is "buy."

• Wall Street's median 12-month price target for Natural Gas Services Group Inc is $33.00, about 23.2% above its August 11 closing price of $25.35

• The stock recently traded at 19 times the next 12-month earnings vs. a P/E of 14 three months ago

Press Release: ID:nGNX1DZ1FS