Chart Industries' Q1 Earnings Report Exceeds Expectations Despite Cash Usage Concerns

TD Cowen's Marc Bianchi raised their price target on Chart Industries (NYSE: GTLS) by 1.9% from $260 to $265 on 2024/05/06. The analyst maintained their Strong Buy rating on the stock.

Responding to Chart Industries' Q1 2024 earnings report, Bianchi noted that the company fell short of expectations in terms of EBITDA and cash usage. However, the analyst also highlighted the strength of the company's order book and the optimistic commentary from management regarding Q2 and future free cash flow.

In their report, Chart Industries announced impressive results for Q4 2023, including an EPS of $2.25, which exceeded the Zacks Consensus Estimate of $2.13 by 5.6%. The company's revenue for the quarter reached $1.02 billion, surpassing Q4 2022's revenue of $441.4 million by an impressive 131.1%. Chart Industries also reported an adjusted EBITDA of $245.2 million, a significant increase from the previous year's figure of $97.5 million. Additionally, the company's free cash flow for Q4 2023 amounted to $119.9 million, up from $71.5 million in Q4 2022.

For the fiscal year 2023, Chart Industries reported an EPS of $6.09 and revenue of $3.35 billion, representing a substantial growth of 108.1% compared to the previous year. The company's adjusted EBITDA for FY 2023 was $736.1 million, up from $296 million in FY 2022. Furthermore, Chart Industries achieved a significant increase in free cash flow, reaching $307.4 million in FY 2023, compared to $139.5 million in FY 2022.

Looking ahead, Chart Industries' management provided guidance for FY 2024, anticipating an EPS of $12.00 to $14.00 and revenue between $4.7 billion and $5 billion. The company also expects adjusted EBITDA in the range of $1.175 billion to $1.3 billion, with free cash flow projected to be between $575 million and $625 million. Chart Industries plans to allocate $115 million to $125 million for capital expenditures.

President and CEO Jill Evanko expressed satisfaction with the integration of Howden, highlighting the achievement of year-one commercial and cost synergies targets ahead of schedule. Evanko believes this integration, along with the company's focus on cash generation and balance sheet deleveraging, positions Chart Industries for continued growth and financial success.

In addition to TD Cowen's analyst rating, other analysts also updated their forecasts for Chart Industries on May 6th. Piper Sandler's Ian Macpherson raised their price target by 6% from $151 to $160, while maintaining a Hold rating on the stock. On the other hand, Stifel Nicolaus's Benjamin Nolan lowered their price target by 1.8% from $224 to $220, while maintaining a Strong Buy rating.

Currently, 75% of top-rated analysts rate Chart Industries as a Strong Buy or Buy, with the remaining 25% holding a Hold rating. No analysts recommend or strongly recommend selling the stock.

According to consensus forecasts among analysts, Chart Industries is expected to achieve earnings per share (EPS) of $3.91 in the upcoming year. If the analysts' predictions hold true, this would represent a remarkable year-over-year increase of 252.2%.

Since the release of Chart Industries' Q1 2024 earnings report on May 3rd, the company's stock price has increased by 1.9%. Over the past year, the stock has seen a significant rise of 23.9%. However, during this period, Chart Industries has slightly trailed behind the S&P 500, which has experienced a 25.2% increase.

TD Cowen analyst Marc Bianchi is ranked in the top 20% out of 4,575 Wall Street analysts by WallStreetZen. With an average return of 9.8% and a win rate of 53.7%, Bianchi specializes in analyzing companies in the Industrials, Energy, and Basic Materials sectors.

Chart Industries, Inc., headquartered in Ball Ground, Georgia, is a global manufacturer and seller of engineered equipment for the energy and industrial gas industries. The company operates through four segments: Distribution & Storage Eastern Hemisphere, Distribution & Storage Western Hemisphere, Energy & Chemicals Cryogenics, and E&C FinFans. Chart Industries provides a wide range of products, including heat exchangers, cold boxes, cryogenic solutions, pressure equipment, and more. The company also offers various services, including installation, repair, maintenance, and upgrading.

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