Lake Street raised its Enviri (NYSE: NVRI) price target to $25.00 from $24.00 and left its Buy rating intact, asserting that the market is not fully pricing the value of the business that will remain after the proposed Clean Earth divestiture. The new target implies roughly a 42% upside from the then-current share price of $17.60 and follows a 154% gain in the stock over the past year.
The brokerage reiterated that the $3.0 billion sale of Clean Earth - which Lake Street calculates as about 18.8x EV/EBITDA on 2025 EBITDA - remains on schedule to close by mid-2026. As that transaction progresses, the company will separate the remaining assets into a new, standalone entity composed of the Environmental and Rail businesses.
Lake Street described performance among the remaining operations as mixed. The Environmental business was characterized as modestly improved, while Rail was said to be continuing to face headwinds. Management guidance for the pro forma new company calls for roughly $1.2 billion in revenue and $140 million of EBITDA in 2026, with Rail pressures persisting into that period.
Using its analysis, Lake Street argues the market currently values the forthcoming standalone company at only about 3.5x EV/EBITDA. The firm views that multiple as too low given the company’s profile - recurring revenue under long-term contracts combined with an equipment business supported by a large installed base and a high share of parts and services revenue. Applying a 6x to 7x multiple to the 2026 estimates, Lake Street places intrinsic value for the new company in the $7.00 to $10.00 per share range, a meaningful premium to the roughly $2.50 per share implied by the prevailing market price at the time of the note.
Lake Street also frames the $25.00 price target as consistent with a 6.5x EV/EBITDA valuation assuming the Clean Earth sale completes as planned.
On the company results front, Enviri reported fourth-quarter 2025 financials that exceeded consensus estimates. The company posted an adjusted earnings per share of -$0.17 versus an expected -$0.23 and reported revenue of $556 million compared with forecasts of $550.9 million. Despite the EPS and revenue beats, Enviri’s shares traded lower in pre-market sessions following the release. The note also states that brokerage analysts had not issued any immediate upgrades or downgrades in response to the quarter.
Additional data cited in the Lake Street commentary - identified as InvestingPro inputs - highlight that Enviri carries roughly $1.7 billion of debt and was unprofitable over the last twelve months. Those points were presented as two of 10 additional analytical items available to subscribers reviewing the investment case.
Overall, Lake Street’s upward revision reflects its view that the Clean Earth proceeds and a reasonable earnings multiple for the post-transaction Environmental and Rail company together support a higher equity value than is currently reflected in the stock price.