Hudson Tech, the Basic Materials sector company, was revisited by a Wall Street analyst yesterday. Analyst Austin Moeller from Canaccord Genuity maintained a Buy rating on the stock and has a $10.50 price target.
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Austin Moeller has given his Buy rating due to a combination of factors including Hudson Technologies’ recent contract renewal with the US Defense Logistics Agency (DLA). This $210 million contract, spanning five years, positions Hudson as a key supplier of refrigerants and industrial gases to various branches of the US military, ensuring a stable revenue stream. Despite a slight reduction in contract value compared to the previous award, the renewal still marks a significant increase from the initial contract, highlighting Hudson’s strong relationship and reliability with the DLA.
Additionally, Moeller anticipates favorable market conditions for Hudson Technologies due to the restricted supply of virgin HFCs under the AIM Act and tariff-related price increases. These factors are expected to boost Hudson’s reclamation and distribution revenues, enhancing their gross margins. The combination of a solid government contract and positive market trends supports Moeller’s confidence in Hudson’s future financial performance, justifying the Buy rating.