Shares of Kirby Corporation (NYSE: KEX) rallied 7.2% on Wednesday after BofA Securities lifted its price target on the stock to $182 from $169 and kept a Buy recommendation.
BofA analyst Ken Hoexter pointed to continued revenue upside across Kirby’s Marine Transportation and Power Generation divisions. In particular, Hoexter emphasized Power Gen as an emerging growth driver, driven by behind-the-meter demand from data centers and industrial customers.
During a recent conference call, management provided detail on operational momentum. CEO David Grzebinski and CFO Raj Kumar reported that inland freight rates continue to trend higher and that Power Gen revenues are on pace to double the company’s installed base within the next 18 months. Management also stated that Power Gen’s backlog has expanded to more than $1 billion.
The company described the Power Gen business as an annuity-like source of service revenues. Management quantified the segment as accounting for roughly 18% of total revenues and 9% of EBIT. They noted that around 50% of the current backlog is tied to higher-margin natural gas solutions, which the company expects to shift the revenue mix and help lift margins toward double-digit levels over time from approximately 6% reported in the first quarter of 2026.
Reflecting these developments, Hoexter raised his 2026 EPS projection to $7.15 from $7.00 and characterized the move as part of a broader view that Kirby benefits from its position as Kawasaki’s exclusive U.S. dealer. The analyst also remarked that growth in beyond-the-meter power demand is accelerating.
BofA did warn that near-term revenue recognition will be uneven because of engine supply constraints, which have forced some second-quarter deliveries to shift into the second half of the year. Despite that timing disruption, the firm said execution remains intact. Hoexter views Power Gen as an important contributor to getting the company toward the upper end of its 5% to 15% 2026 EPS growth target.
Adding to the positive analyst sentiment, Stephens initiated coverage on Kirby with an Overweight rating, bringing additional institutional interest to the equity.
Market context - The move in Kirby’s shares reflects investor focus on durable service revenues from Power Gen, rising inland transportation rates and the interplay between supply-chain timing and revenue recognition. Analysts have adjusted models to account for Power Gen's faster expansion and the impact of higher-margin natural gas solutions on future profitability.