Natural Gas Services: Due For A Valuation Re-Rating

Ronald Ferrie3.71K FollowersFollow5ShareSavePlay(13min)CommentsSummaryNatural Gas Services Group is significantly undervalued versus peers due to lack of midstream exposure.NGS maintains similar contract structures and profitability for wellhead compression, despite market concerns over business stability.NGS is investing in growth at a higher rate than competitors, with potential valuation uplift if a midstream contract is secured.I reiterate a BUY rating with a $52/share price target, expecting double-digit returns as growth drivers materialize. olm26250/iStock via Getty Images Thesis Natural Gas Services Group (NGS) remains significantly undervalued compared to peers. This undervaluation stems from the company's lack of midstream business exposure and concentration in business closer to the well-bore. However, well-head applications retain similarThis article was written byRonald Ferrie3.71K FollowersFollowI am a Licensed Professional Engineer who works in the Nuclear Power industry. I use my professional working knowledge of the power/energy industries to aid in evaluating potential equities worthy of long-term investment. I invest in income producing equities and rental real estate properties for cash flow and long-term appreciation. My articles are to serve as a platform for presenting the underlying fundamentals and long-term potential of each equity/business.Analyst’s Disclosure: I/we have a beneficial long position in the shares of NGS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.