Kodiak Gas Services initiated with a Buy at Redburn Atlantic

Redburn Atlantic initiated coverage of Kodiak Gas Services with a Buy rating and $35 price target. Kodiak offers investors an attractive way to gain exposure to structural growth in U.S. natural gas demand, the analyst tells investors in a research note. The firm says rising demand for compression, coupled with industry consolidation and capital discipline on the part of providers, has seen the company’s utilization rise alongside pricing and returns. It forecasts Kodiak growing underlying annual EBITDA at 9% organically over the next three years.