THE WOODLANDS, Texas - Kodiak Gas Services, Inc. (NYSE: KGS), a prominent provider of contract compression services in the U.S., has announced an underwritten public offering of shares held by an affiliate of EQT (ST:EQTAB) Infrastructure. The affiliate is offering 5,500,000 shares of Kodiak's common stock, resulting in gross proceeds of approximately $232.9 million. The transaction is scheduled to close on December 13, 2024, subject to standard closing conditions. According to InvestingPro data, KGS shares are trading near their 52-week high of $44.20, having delivered an impressive 158% return over the past year. Current analysis suggests the stock is trading above its Fair Value.
Kodiak itself is not selling any shares and will not receive any proceeds from the offering. The shares are being offered through Goldman Sachs & Co. LLC and J.P. Morgan, acting as the underwriters for the offering.
This offering is part of an automatic shelf registration statement on Form S-3, filed with the Securities and Exchange Commission (SEC) and became effective on July 10, 2024. Investors interested in the offering can access the prospectus supplement and accompanying base prospectus on the SEC’s website or obtain them directly from the underwriters.
Kodiak plays a crucial role in the energy infrastructure sector, offering contract compression and related services to oil and gas producers and midstream customers. Their services are vital for the production and transportation of natural gas and oil across high-volume gas gathering systems, processing facilities, gas lift applications, and transmission systems. With a market capitalization of $3.81 billion and last twelve months revenue of $1.08 billion, the company maintains a significant presence in the sector, though InvestingPro analysis indicates it operates with a substantial debt burden of $2.67 billion.
The company's press release also contains forward-looking statements, which are subject to various risks and uncertainties that could cause actual results to differ materially from those projected. The statements include expectations about the offering's closing. Kodiak has outlined these risks in its annual and quarterly reports filed with the SEC.
This news is based on a press release statement from Kodiak Gas Services, Inc. Investors are advised to read the company's filings with the SEC for more detailed information before making any investment decisions. For a comprehensive analysis of KGS's financial health, valuation metrics, and growth potential, investors can access the detailed Pro Research Report available on InvestingPro, which covers over 1,400 US stocks with expert insights and actionable intelligence.
In other recent news, Kodiak Gas Services has reported robust earnings and revenue results, aligning closely with expectations with an EBITDA of $154 million. The company also increased its quarterly cash dividend by 8% to $0.41 per share. Furthermore, Kodiak initiated a public offering of approximately 6.14 million shares by an affiliate of EQT Infrastructure funds. The company also announced plans to repurchase $25 million of its common stock and authorized a $50 million stock repurchase program.
In addition, RBC Capital Markets maintained an Outperform rating on Kodiak shares and raised the company's price target to $40.00. Mizuho (NYSE:MFG) also initiated coverage on the stock with an Outperform rating and a price target of $36.00. These ratings reflect recent developments for Kodiak Gas Services.
Kodiak Gas Services is taking strategic steps to improve its offerings by upgrading its fleet quality. The company is expected to see an approximate 8% compound annual growth rate in EBITDA, buoyed by industry tailwinds and a clear capital allocation strategy. The company's focus on the Permian region and its relatively younger fleet are considered key differentiators. These are recent developments for Kodiak Gas Services.
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