Strategic Transformation and Growth Prospects Drive Buy Rating for Westport Fuel Systems

Analyst Amit Dayal of H.C. Wainwright maintained a Buy rating on Westport Fuel Systems (WPRT – Research Report), retaining the price target of $7.00.

Amit Dayal has given his Buy rating due to a combination of factors influencing Westport Fuel Systems’ future prospects. The company is undergoing a strategic transformation, focusing on divesting its interest in Westport Fuel Systems Italia S.r.l., which is expected to close by the end of the second quarter of 2025. This divestiture will allow Westport to concentrate on leveraging its HPDI technology for alternative fuel solutions, including LNG, CNG, RNG, and hydrogen systems, where it holds a significant technological advantage.
Additionally, the company is expected to see revenue growth and margin improvements, particularly through its operations in China with partner Weichai. The projected revenue for 2025 stands at $148.7 million, with a significant increase anticipated over the next decade. Despite the risks associated with market adoption and execution, the long-term growth potential and strategic focus on the natural gas market underpin the Buy rating, with a price target of $7.00 based on a discounted cash flow analysis.

In another report released on May 15, Craig-Hallum also maintained a Buy rating on the stock with a $8.00 price target.