TETRA Technologies: Buy Rating Backed by Strategic Shift to Specialty Chemicals, Margin Expansion, and Higher 2027 Valuation

Tetra Technologies, the Industrials sector company, was revisited by a Wall Street analyst today. Analyst Bobby Brooks from Northland Securities maintained a Buy rating on the stock and has a $11.50 price target.

Bobby Brooks has given his Buy rating due to a combination of factors that point to meaningful growth and an improving business profile for Tetra Technologies. He highlights the company’s strategic transformation from a traditional oilfield services provider into a higher-value specialty chemicals and water solutions company, underpinned by increasing volumes to EOSE and the anticipated commercialization of the Oasis technology by late 2027. His newly introduced 2027 forecasts call for faster top-line growth, rising margins, and stronger free cash flow as these higher-quality, recurring revenue streams scale. This evolving mix, in his view, supports not only better fundamentals but also the potential for valuation multiple expansion over time.
Bobby Brooks also sees a clear path to improved profitability metrics, with gross margins and adjusted EBITDA margins both expected to expand meaningfully by 2027, supported largely by growing EOSE-related contributions. He models disciplined cost control, with SG&A rising modestly in dollars but declining as a percentage of sales, and free cash flow strengthening even after accounting for both maintenance and growth capital expenditures. On valuation, he raises his price target from $8.50 to $11.50 by applying a higher 11x multiple to his 2027 adjusted EBITDA estimate of roughly $149 million, reflecting the company’s shift toward a more attractive specialty chemicals profile. Collectively, these operational, financial, and valuation drivers underpin his view that the shares remain attractive and justify a Buy recommendation.

In another report released on December 22, Clear Street also maintained a Buy rating on the stock with a $10.00 price target.

Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of TTI in relation to earlier this year.