Target Hospitality Q3 revenue up 30%, beats estimates
Overview
US modular accommodations provider's Q3 revenue rose 30%, beating analyst expectations
Adjusted EBITDA rose 59%, driven by WHS segment growth, while margin rose by approximately 480 bps yr/yr
Company posted net loss of $9.2 mln
Outlook
Company reaffirms full-year 2026 revenue outlook of $435 mln to $445 mln
Target Hospitality expects 2026 adj EBITDA of $105 mln to $115 mln
Company projects annualized revenue above $750 mln and adj EBITDA over $300 mln exiting 2027
Result Drivers
WHS SEGMENT GROWTH - Revenue and margin gains were primarily driven by significant growth in the Workforce Hospitality Solutions segment and completion of ramp-up phases at the Dilley, Texas community
PORTFOLIO MIX SHIFT - Margin expansion reflected a shift toward higher-margin hospitality services, including premium accommodations and amenities, as well as greater operating efficiencies as WHS communities scaled
CONTRACT AWARDS AND SCOPE EXPANSIONS - Multiple new and expanded multi-year contracts in WHS increased total contract value and contributed to revenue growth
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Beat | $129.1 mln | $118.35 mln (5 Analysts) |
Q3 Net Loss | $9.2 mln | ||
Q3 Adjusted EBITDA | $34.2 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"
The average consensus recommendation for the hotels, motels & cruise lines peer group is "buy"
Wall Street's median 12-month price target for Target Hospitality Corp. is $25.50, about 124.5% above its November 6 closing price of $11.36
The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 51 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)