Lake Street Capital Markets has started coverage of Allient Inc. (NASDAQ: ALNT) with a buy rating and a price target set at $79.00, the firm said in its initial research note. That target implies upside from the stock's quoted price of $66.97, although market data indicates the share is trading above its fair value.
The broker highlighted Allient's recovery in profitability and robust cash generation following a strategic portfolio reset in 2023. Management's repositioning appears to be translating into better unit economics - Allient recorded a record 33.3% gross margin in the third quarter of 2025 and has now reported five consecutive quarters of margin expansion.
Looking at recent performance metrics, consolidated data show a trailing-12-month gross profit margin of 32.57% and an EBITDA of $66.12 million. On the balance sheet, the company carries a moderate leverage profile with a debt-to-equity ratio of 0.73.
Lake Street's model assumes revenue growth will pick up this year and continue into next, driven alongside further margin expansion. The firm projects earnings per share will rise 25% in 2026 and 17% in 2027. Those forecasts align with broader analyst expectations that net income will grow in the current period; three analysts have recently revised their earnings estimates upward. The consensus EPS forecast for fiscal 2025 currently stands at $2.05.
The research note emphasized that Allient's improved cash generation should enable the company to reduce its leverage and retain flexibility to pursue selective acquisitions, rather than relying on more extensive external financing. Lake Street also noted the stock's strong price performance over the past year, rising roughly 144% compared with a 16% gain for the Russell 2000 index. Recent returns over shorter horizons include a 48.24% increase across the prior six months.
Valuation was central to the firm's target derivation. Lake Street based its $79 price target on a 15x EV/EBITDA multiple applied to its estimate of adjusted EBITDA for 2027. By contrast, current market multiples show Allient trading at an EV/EBITDA of 19.54 and a price-to-earnings ratio of 59.39, which the note describes as indicating a premium valuation versus the multiple implicit in the $79 target.
Investors interested in the finer points of Allient's financial profile may want to review full valuation schedules and scenario assumptions in the firm's research. For now, Lake Street's initiation frames the company's recent margin recovery, cash flow strength, and potential debt reduction as key pillars supporting earnings growth and possible targeted M&A activity.
Context and implications
Allient's ongoing margin improvement and the prospect of accelerating revenue are central to Lake Street's bullish stance. The combination of improved operating margins and positive cash flow is expected to create scope for balance-sheet repair and selective expansion without materially increasing leverage.