Analyst Initiation and Rating
Needham analyst Sean Milligan initiated coverage of Babcock & Wilcox Enterprises Inc (NYSE:BW), assigning a Buy rating and setting a $20 price target. Milligan priced the stock at $7.16, stating that this level largely reflects the core business and the net present value of the newly secured Base Electron project.
Share Price Reaction
Following the coverage note, BW shares rose approximately 6.4% in pre‑market trading and posted an overall gain of about 6.98% after the announcement.
Contract Wins and Backlog Expansion
The analyst highlighted two recent contract developments:
- A $2.4 billion FastPower award with Base Electron, which lifted the company’s backlog to roughly $2.6 billion.
- A second FastPower project that is expected to receive a final notice to proceed before year‑end 2026.
Strategic Outlook and Upside Potential
Milligan noted that the FastPower platform could become a repeatable data‑center generation solution as gas‑turbine lead times lengthen and combined‑cycle costs rise, potentially driving a re‑rating of the equity. He further indicated that the current share price incorporates limited credit for the expansion of FastPower into a quoted pipeline of more than $14 billion in 2027 and beyond, as well as the upcoming BrightLoop projects slated for 2028 and later. The $20 target implies an upside of roughly 179% from the current level.