Target Hospitality Corp (TH)
NASDAQ:TH
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Target Hospitality
(NASDAQ:TH)
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Rating:69Neutral
Price Target:
$20.00
▲(34.77% Upside)
Action:Downgraded
Date:05/22/26
The score reflects strong forward momentum from guidance and contract wins, plus supportive balance sheet and cash flow, offset by current/TTM losses and only middling valuation support from a negative P/E. Technicals are constructive but appear somewhat extended, adding modest near-term risk.
Positive Factors
Large multiyear contract backlog and pipeline
A multiyear backlog and a >20,000-bed pipeline provide durable revenue visibility and reduce short-term demand sensitivity. Long-term minimum revenue commitments shift earnings from lumpy construction to recurring services over time, enabling predictable cash flows and scale benefits as communities mature.
Negative Factors
Current losses and negative returns
Sustained negative net margin and negative EBIT in recent periods mean reported profitability and ROE are impaired. Even with EBITDA positive, accounting losses constrain retained earnings and limit dividends, share buybacks or equity-friendly capital returns until operating profitability is restored.
Read all positive and negative factors
Positive Factors
Negative Factors
Large multiyear contract backlog and pipeline
A multiyear backlog and a >20,000-bed pipeline provide durable revenue visibility and reduce short-term demand sensitivity. Long-term minimum revenue commitments shift earnings from lumpy construction to recurring services over time, enabling predictable cash flows and scale benefits as communities mature.
Read all positive factors
Target Hospitality (TH) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.70B
Dividend YieldN/A
Average Volume (3M)437.22K
Price to Earnings (P/E)―
Beta (1Y)0.65
Revenue Growth-7.43%
EPS Growth-198.60%
CountryUS
Employees770
SectorIndustrials
Sector Strength72
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)-0.44
Shares Outstanding100,163,840
10 Day Avg. Volume323,886
30 Day Avg. Volume437,218
Financial Highlights & Ratios
PEG Ratio0.14
Price to Book (P/B)2.05
Price to Sales (P/S)2.49
P/FCF Ratio113.02
Enterprise Value/Market Cap1.04
Enterprise Value/Revenue5.48
Enterprise Value/Gross Profit957.52
Enterprise Value/Ebitda36.22
Forecast
1Y Price Target
$20.00Price Target Upside34.77% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)-0.16
Revenue Forecast (FY)$376.56M
Target Hospitality Business Overview & Revenue Model
Company Description
Target Hospitality Corp. operates as a specialty rental and hospitality services company in North America. The company operates through four segments: Hospitality & Facilities Services - South, Hospitality & Facilities Services - Midwest, Governme...
How the Company Makes Money
Target Hospitality primarily makes money by providing contracted lodging and hospitality services through workforce housing communities and related site-support offerings. Key revenue streams generally include: (1) Lodging/accommodation fees: Reve...
Target Hospitality Earnings Call Summary
Earnings Call Date:Mar 11, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call presents strong commercial momentum driven by a large pipeline and sizeable multiyear contract awards (>$740M total, >$495M WHS), meaningful balance sheet strength (zero net debt, ~$183M liquidity), and a confident 2026 financial outlook. Near-term headwinds include compressed margins in Q4 due to construction-heavy revenue mix, modest Q4 adjusted EBITDA (~$7M), corporate expense true-ups, and limited spare bed inventory (3,000–4,000) that may require incremental capital or purchases if much of the 20,000-bed pipeline converts quickly. Management expects Q1 to be the low point and anticipates margin expansion as WHS contracts shift from construction to services and as community expansions scale. Overall the positive contract momentum, strong liquidity, and clear path to higher-margin recurring revenue materially outweigh the near-term operational and timing challenges.Positive Updates
Strong Contract Wins and WHS Expansion
Secured more than $740 million in long-term contract awards since February 2025, including over $495 million within the rapidly expanding WHS segment; WHS awards reactivated nearly 3,000 beds in under a year and created an active pipeline representing more than 20,000 beds.
Negative Updates
Margin Compression in Q4
Q4 margins were temporarily compressed due to a meaningful portion of revenue coming from lower-margin construction services tied to the workforce hub contract and elevated initial operating and mobilization costs associated with new WHS wins.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Contract Wins and WHS Expansion
Secured more than $740 million in long-term contract awards since February 2025, including over $495 million within the rapidly expanding WHS segment; WHS awards reactivated nearly 3,000 beds in under a year and created an active pipeline representing more than 20,000 beds.
Read all positive updates
Company Guidance
The 2026 guidance calls for total revenue of $320–$330 million, adjusted EBITDA of $60–$70 million and capital spending (ex‑acquisitions) of $65–$75 million, with Q1 as the low point and steady ramp thereafter to exit 2026 at an annualized revenue run rate of >$360 million and adjusted EBITDA >$90 million; management expects the WHS segment to be the largest by 2026, contributing >40% of consolidated revenue. For context, Q4 2025 revenue was ≈$90 million with adjusted EBITDA ≈$7 million, corporate expense ≈$18 million and quarterly capex ≈$16 million; the company finished 2025 with zero net debt, available liquidity of ≈$183 million, cash from operations >$74 million and discretionary cash flow of $66 million. The outlook is supported by >$740 million in multiyear contract awards since Feb 2025 (including >$495 million in WHS), a pipeline of >20,000 beds, reactivation of nearly 3,000 beds, ~3,000–4,000 beds of remaining inventory, and specific contract commitments such as a ~$170 million workforce hub, a data‑center community with ~$134 million minimum revenue through May 2028, a West Texas Power Community (~$129 million over 47 months for up to 1,400 beds) and the Pecos Power Community (> $23 million over 26 months for up to 400 beds).Target Hospitality Financial Statement Overview
Summary
Income Statement
38
Negative
Balance Sheet
72
Positive
Cash Flow
74
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 323.52M | 320.63M | 386.27M | 563.61M | 501.99M | 291.34M |
| Gross Profit | 1.85M | 12.98M | 178.18M | 313.32M | 247.13M | 101.35M |
| EBITDA | 48.94M | 61.45M | 125.10M | 332.62M | 224.29M | 102.21M |
| Net Income | -43.58M | -37.12M | 71.27M | 173.70M | 73.94M | -4.58M |
Balance Sheet | ||||||
| Total Assets | 539.54M | 530.21M | 725.77M | 694.35M | 771.73M | 513.39M |
| Cash, Cash Equivalents and Short-Term Investments | 5.46M | 8.35M | 190.67M | 103.93M | 181.67M | 23.41M |
| Total Debt | 38.99M | 10.70M | 209.65M | 200.83M | 354.69M | 331.64M |
| Total Liabilities | 162.92M | 141.15M | 304.68M | 317.05M | 570.88M | 416.12M |
| Stockholders Equity | 376.92M | 389.26M | 421.08M | 377.31M | 200.85M | 97.27M |
Cash Flow | ||||||
| Free Cash Flow | 59.46M | 7.05M | 121.43M | 88.38M | 164.77M | 69.11M |
| Operating Cash Flow | 77.19M | 74.09M | 151.68M | 156.80M | 305.61M | 104.60M |
| Investing Cash Flow | -89.94M | -67.79M | -28.84M | -68.18M | -140.23M | -35.91M |
| Financing Cash Flow | -16.27M | -188.64M | -36.06M | -166.37M | -7.10M | -52.27M |
Target Hospitality Technical Analysis
Neutral
14.84
Price Trends
15.10
Positive
11.42
Positive
9.70
Positive
Market Momentum
0.67
Positive
53.92
Neutral
18.77
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TH, the sentiment is Neutral. The current price of 14.84 is below the 20-day moving average (MA) of 17.48, below the 50-day MA of 15.10, and above the 200-day MA of 9.70, indicating a neutral trend. The MACD of 0.67 indicates Positive momentum. The RSI at 53.92 is Neutral, neither overbought nor oversold. The STOCH value of 18.77 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TH.
Target Hospitality Risk Analysis
Target Hospitality disclosed 11 risk factors in its most recent earnings report. Target Hospitality reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Target Hospitality Peers Comparison
UnderperformOutperform
Sector (63)
TH
Target Hospitality
17.06
9.82
135.64%
PRSU
Pursuit Attractions and Hospitality
43.56
15.38
54.58%
CVEO
Civeo
34.20
11.96
53.78%
Target Hospitality Corporate Events
Business Operations and StrategyShareholder Meetings
Target Hospitality Shareholders Back Governance and Incentive Plans
Positive
May 21, 2026
On May 21, 2026, Target Hospitality held its 2026 Annual Meeting of Stockholders, where shareholders re-elected all nominated directors for terms expiring at the 2027 meeting and ratified the appointment of Ernst Young LLP as independent auditor ...
Business Operations and StrategyExecutive/Board Changes
Target Hospitality Adds Infrastructure Veteran to Board of Directors
Positive
May 7, 2026
On May 5, 2026, Target Hospitality appointed digital infrastructure veteran Paul Hohnsbeen to its board of directors as an independent director and member of the Nominating and Corporate Governance Committee. The move was announced publicly on May...
Private Placements and FinancingRegulatory Filings and Compliance
Target Hospitality Announces Secondary Offering by TDR Affiliates
Neutral
Apr 22, 2026
On April 21, 2026, Target Hospitality entered into an underwriting agreement for a secondary public offering of 7,000,000 shares of its common stock held by selling shareholders Arrow Holdings S.à r.l. and MFA Global S.à r.l., entities c...
Business Operations and StrategyFinancial Disclosures
Target Hospitality Secures Major Hyperscaler Data Center Contract
Positive
Apr 1, 2026
On April 1, 2026, Target Hospitality announced a multi-year lease and services agreement exceeding $550 million in committed minimum revenue with a top-five hyperscaler, to build and operate a purpose-built “Data Center Hub” community ...
Business Operations and StrategyExecutive/Board Changes
Target Hospitality Extends Executive PSU Metrics and Updates Outlook
Neutral
Mar 12, 2026
On March 8, 2026, Target Hospitality’s board compensation committee approved a second amendment to its Executive Performance Stock Unit Agreement, extending the performance period for the diversification EBITDA metric tied to 2023 performanc...
Business Operations and StrategyExecutive/Board Changes
Target Hospitality Adopts New Performance-Based Executive Equity Plan
Positive
Mar 4, 2026
On February 25, 2026, Target Hospitality’s board approved new forms of executive restricted stock unit and performance stock unit agreements under its 2019 Incentive Plan, aligning future stock-based awards for senior leaders with updated st...
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.