(Target Hospitality's stock falls after issuing a soft revenue forecast)
Shares of Target Hospitality have dropped to their lowest level in over a year following the company's announcement of a weak revenue forecast for next year. The government contractor and modular-housing provider saw its stock slip approximately 10% to $9.90 per share during morning trading. Overall, shares have declined more than 34% this year.
Revenue Expectations Below Analysts' Estimates
(Target Hospitality targets lower revenue than expected)
Target Hospitality, based in Woodlands, Texas, is aiming for a revenue range of $410 million to $425 million for 2024. This falls short of the $456.1 million anticipated by analysts surveyed by FactSet.
In addition, the company has revised its revenue guidance for the current year. It now expects the revenue to be within the range of $550 million to $560 million, compared to its previous forecast of $550 million to $580 million.
Contract Award and Funding Details
(Target Hospitality discloses contract terms and funding details)
Target Hospitality also revealed certain terms related to a contract they were awarded last month. The contract involves the company's influx-care facility at the Pecos Children's Center, which is used to house children who have illegally crossed the border.
The new contract, funded through a $75 billion indefinite delivery, indefinite quantity federal contract, could provide up to $3.3 billion in potential funding until 2028, as stated by Target Hospitality.
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