Already having a decent year, the stock of Montrose Environmental Group (MEG -0.74%) added to this with a solid week on the trading floor. Shares of the company rose by almost 13% during the period, according to data compiled by S&P Global Market Intelligence. A new acquisition, raised guidance, and an analyst price target raise were the catalysts behind that rise.
New asset bought and guidance hiked
On Tuesday, Montrose divulged that it is the new owner of the formerly private Engineering & Technical Associates, which specializes in process safety management (PSM is the storing, handling, and transport of hazardous materials). The company is being absorbed into Montrose's assessment, permitting, and response business unit.
The buyer did not disclose the price it paid for its new asset.
Montrose did quote company co-founders Dan and Lisa Wilczynski as saying that they "knew that our cultures, client philosophies and focus on superior outcomes were fully aligned. As part of a larger team, we can learn from each other, grow faster and create an industry-leading PSM offering."
With the company in its pocket, Montrose upped its revenue and earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance for the entirety of 2024. The company now believes it will earn $690 million to $740 million; its previous guidance range was $675 million to $725 million. Non-GAAP (adjusted) EBITDA should land at $95 million to $100 million. Formerly, the outlook was for $90 million to $95 million.
Analyst inspired to raise price target
Following news of the acquisition and the bolstered guidance, Stifel analyst Michael Hoffman raised his price target on Montrose stock. It now stands at $51 per share; it had been $48. Hoffman reiterated his buy recommendation while making the change.