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Kodiak Gas Services, Inc.
(NYSE:KGS)
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Rating:71Outperform
Price Target:
$66.00
▲(11.71% Upside)
Action:Upgraded
Date:08/09/26
KGS scores well on fundamentals and the latest earnings call, driven by strengthened balance sheet positioning, strong operational metrics, and raised 2026 outlook. The score is held back by weakening technical momentum and a demanding valuation (high P/E), plus the near-term cash/CapEx intensity implied by negative TTM free cash flow and the power expansion ramp.
Positive Factors
Balance-sheet de-risking
A dramatic reduction in leverage to near-zero materially improves Kodiak’s financial flexibility and lowers insolvency risk. This stronger capital base supports sustained investment in growth initiatives, dividend continuity, and access to capital on better terms over the next several years.
Negative Factors
Negative trailing free cash flow
TTM negative free cash flow indicates reinvestment and working‑capital needs are currently outpacing cash generation. Over a multi‑month horizon, sustained negative FCF would force reliance on external capital or slower dividend/growth plans, reducing flexibility during the power buildout.
Read all positive and negative factors
Positive Factors
Negative Factors
Balance-sheet de-risking
A dramatic reduction in leverage to near-zero materially improves Kodiak’s financial flexibility and lowers insolvency risk. This stronger capital base supports sustained investment in growth initiatives, dividend continuity, and access to capital on better terms over the next several years.
Read all positive factors
Kodiak Gas Services, Inc. Key Performance Indicators (KPIs)
Any
Assets by Segment
Maps the company’s assets to each segment to show where capital is tied up and how asset-heavy each line of business is. Offers insight into capital intensity, maintenance and replacement needs, potential bottlenecks, and which segments may require more investment or be candidates for divestiture.
Maps the company’s assets to each segment to show where capital is tied up and how asset-heavy each line of business is. Offers insight into capital intensity, maintenance and replacement needs, potential bottlenecks, and which segments may require more investment or be candidates for divestiture.
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The Fly
The FlyKodiak Gas Services, Inc. (KGS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.61B
Dividend Yield2.96%
Average Volume (3M)1.89M
Price to Earnings (P/E)75.1
Beta (1Y)0.77
Revenue Growth8.23%
EPS Growth-6.88%
CountryUS
Employees1,300
SectorEnergy
Sector Strength52
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)0.88
Shares Outstanding101,104,034
10 Day Avg. Volume1,579,032
30 Day Avg. Volume1,893,927
Financial Highlights & Ratios
PEG Ratio0.76
Price to Book (P/B)2.67
Price to Sales (P/S)2.46
P/FCF Ratio11.34
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$82.56Price Target Upside39.74% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering10
EPS Forecast (FY)2.15
Revenue Forecast (FY)$1.53B
Kodiak Gas Services, Inc. Business Overview & Revenue Model
Company Description
Kodiak Gas Services, Inc. (KGS) is a U.S.-based provider of contract compression services to the oil and gas industry, supporting upstream and midstream customers by supplying, operating, and maintaining natural gas compression equipment. The comp...
How the Company Makes Money
KGS primarily makes money by contracting natural gas compression horsepower to customers under service agreements and charging recurring fees for providing the compression equipment along with ongoing operations and maintenance. The core revenue s...
Kodiak Gas Services, Inc. Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call skewed positive: Kodiak reported strong top-line growth (revenue +21% YoY), record adjusted EBITDA (+22% YoY), industry-leading compression metrics (4.4M HP, 98.2% utilization, 70% adjusted gross margin, price per HP +4.5% YoY), meaningful progress on building a power platform (Baker Hughes agreement, ~1.8 GW secured, 2 GW target by 2030), and improved 2026 guidance and discretionary cash flow outlook. The company strengthened its balance sheet via an $836M equity raise, reduced leverage to ~3.1x, and declared a covered dividend. Key negatives are commodity-driven cost pressure (lube oil/fuel), long equipment lead times, sizable near-term CapEx needs for power buildout, and execution/contracting risk as the new Power Infrastructure business scales. Overall, the positives — robust financial performance, strengthened balance sheet, confirmed supply agreements, and a growing commercial pipeline — materially outweigh the manageable headwinds and execution risks.Positive Updates
Strong Top-Line and EBITDA Growth
Reported consolidated revenue of $391 million, up 21% year-over-year, and record adjusted EBITDA of $217 million, up 22% year-over-year.
Negative Updates
Commodity Cost Headwinds: Lube Oil and Fuel
Late-quarter spike in lube oil prices (attributed to higher oil prices and crack spreads from geopolitical events) created a material headwind to COGS in the compression business. Management quantified the lube oil impact at roughly $1.5 million per month (≈$18 million annualized margin impact) if sustained, though they have been able to mitigate much of the effect via supplier contracts and scale.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Top-Line and EBITDA Growth
Reported consolidated revenue of $391 million, up 21% year-over-year, and record adjusted EBITDA of $217 million, up 22% year-over-year.
Read all positive updates
Company Guidance
Management raised the 2026 outlook, increasing adjusted EBITDA to $830–860 million and discretionary cash flow to $570–600 million while tightening Compression Infrastructure adjusted gross margin to 69.0–70.5%; Q2 results underpinning the update included revenue of $391 million (+21% YoY), adjusted EBITDA of $217 million (+22% YoY), adjusted net income of $54 million ($0.55/sh), compression revenue‑generating horsepower of 4.4 million (avg 991 HP/unit), utilization 98.2%, price per ending HP $23.80 (+4.5% YoY) and compression adj. gross margin of 70% (↑170 bps), Power Infrastructure exited Q2 with a 405 MW fleet, Q2 power revenues of $33 million and ~65% adj. gross margin, and the company expects ~50 MW of genset deliveries in H2 2026; CapEx guidance was updated to compression growth CapEx $280–300 million and Power Infrastructure CapEx $400–450 million (excluding a $43 million non‑cash Midland lease), while Q2 CapEx included maintenance ~$20M, compression growth ~$67M and power growth ~$134M; longer‑term targets remain ~170k HP organic additions in 2026 and ~150k HP/year to reach ~5.2M HP by 2030, ~1.8 GW of power generation secured for 2030 (≈66% turbines) with a 2 GW power target by 2030, expected fleet build raw cost roughly $1.2M/MW (≈$1.5M/MW incl. balance‑of‑plant), and financial flexibility from a May equity raise of ~$836M leaving net debt ≈$2.6B and leverage ~3.1x; Q2 discretionary cash flow was $163M and the Board declared a $0.49/share dividend (coverage >3x).Kodiak Gas Services, Inc. Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
88
Very Positive
Cash Flow
62
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.39B | 1.31B | 1.16B | 850.38M | 707.91M | 606.38M |
| Gross Profit | 558.32M | 551.99M | 440.66M | 316.64M | 266.10M | 236.15M |
| EBITDA | 603.38M | 590.67M | 533.32M | 440.52M | 479.69M | 367.07M |
| Net Income | 80.39M | 80.52M | 49.90M | 20.07M | 106.27M | 180.96M |
Balance Sheet | ||||||
| Total Assets | 5.50B | 4.32B | 4.44B | 3.24B | 3.21B | 3.01B |
| Cash, Cash Equivalents and Short-Term Investments | 137.55M | 3.18M | 4.75M | 5.56M | 20.43M | 28.80M |
| Total Debt | 85.46M | 43.80M | 2.65B | 1.83B | 2.73B | 1.85B |
| Total Liabilities | 3.34B | 3.11B | 3.06B | 2.10B | 2.98B | 2.05B |
| Stockholders Equity | 2.16B | 1.21B | 1.36B | 1.14B | 229.09M | 960.07M |
Cash Flow | ||||||
| Free Cash Flow | 5.01M | 284.27M | -8.97M | 46.53M | -39.50M | 48.04M |
| Operating Cash Flow | 478.89M | 599.74M | 327.99M | 266.33M | 219.85M | 249.98M |
| Investing Cash Flow | -1.03B | -285.29M | -292.47M | -218.42M | -251.38M | -202.03M |
| Financing Cash Flow | 682.92M | -316.02M | -36.33M | -62.77M | 23.17M | -43.25M |
Kodiak Gas Services, Inc. Technical Analysis
Positive
59.08
Price Trends
65.15
Positive
65.36
Positive
53.40
Positive
Market Momentum
-0.51
Negative
59.28
Neutral
92.11
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KGS, the sentiment is Positive. The current price of 59.08 is below the 20-day moving average (MA) of 60.33, below the 50-day MA of 65.15, and above the 200-day MA of 53.40, indicating a bullish trend. The MACD of -0.51 indicates Negative momentum. The RSI at 59.28 is Neutral, neither overbought nor oversold. The STOCH value of 92.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KGS.
Kodiak Gas Services, Inc. Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $5.20B | 15.55 | 32.92% | ― | 3.84% | 75.32% | |
76 Outperform | $5.88B | 61.72 | 6.75% | 1.02% | 21.79% | -55.76% | |
71 Outperform | $6.61B | 75.14 | 5.55% | 3.25% | 8.23% | -6.88% | |
69 Neutral | $489.75M | 23.47 | 7.31% | 1.29% | 15.42% | 13.10% | |
67 Neutral | $6.08B | 18.61 | 21.96% | 2.38% | 11.54% | 40.91% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
65 Neutral | $3.86B | 25.15 | 141.15% | 7.96% | 19.87% | 60.57% |
* Energy Sector Average
KGS
Kodiak Gas Services, Inc.
66.12
31.71
92.16%
AROC
Archrock
34.62
11.16
47.56%
NGS
Natural Gas Services Group
38.26
13.37
53.72%
OII
Oceaneering International
54.11
31.54
139.74%
USAC
USA Compression
26.91
4.61
20.69%
WHD
Cactus
73.45
34.62
89.13%
Kodiak Gas Services, Inc. Corporate Events
Dividends
Kodiak Gas Declares Consistent Second-Quarter Cash Dividends
Positive
Aug 6, 2026
Kodiak Gas Services, Inc. announced on August 5, 2026, that its board has declared a second-quarter cash dividend of $0.49 per share of common stock, payable on August 27, 2026, to shareholders of record as of August 17, 2026. The move underscores...
Business Operations and StrategyPrivate Placements and Financing
Kodiak Gas Services Completes Equity Offering for Expansion
Positive
May 15, 2026
On May 13, 2026, Kodiak Gas Services, Inc. entered an underwriting agreement with Goldman Sachs Co. LLC and J.P. Morgan Securities LLC to sell 10,563,380 shares of common stock at $71.00 per share, with underwriters exercising in full a 30-day op...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.