Should I buy USA Compression? Can it surge short-term?

``` The deep research logic is organized as follows: Okay, let's tackle this question about whether to buy USA Compression (USAC) and if it can surge short-term. First, I need to go through all the provided references and background information to gather the necessary data points. Starting with the latest report period, USAC's latest report is for Q2 2025 . The earnings release date was August 6, 2025 . The estimates for Q3 2025 show an EPS of $0.23 and revenue of $246.98 million . The analyst consensus rating is "Sell" with an average price target of $25 . The stock's volatility is 0.67% weekly . Looking at the earnings reports, USAC beat Q2 estimates with EPS of $0.22 and revenue of $250.1 million . The company maintained a distribution of $0.525 per unit, which is a positive sign for income investors . However, net income decreased to $28.6 million from $31.2 million . The average revenue per horsepower increased by 5% YoY, but utilization slightly decreased . Analysts have mixed views, with some maintaining a "Hold" or "Outperform" rating . The stock price is $24.06 as of the latest data, with a 1.39% decrease . The consensus for the full year 2025 EPS is $1.01 . The company's balance sheet shows total assets of $2.67 billion and long-term debt of $2.5 billion . They have a distributable cash flow of $89.9 million, providing 1.4X coverage for distributions . Considering the short-term surge potential, the stock's volatility is low at 0.67% weekly . The price target from analysts is $25, which is a 4.0% upside from the current price . However, the consensus rating is "Sell," which might indicate cautious sentiment. The company's ability to maintain distributions and beat revenue estimates could attract income-focused investors, but the net income decline and debt levels might be concerns. I need to structure the answer with a clear conclusion first, then detailed analysis using tables and citations. Make sure to include the visualization for the "USA Compression Latest Report Period" query . Also, check if any other visualizations are needed based on the references. The user's profile doesn't provide additional info, so focus on the data given. Potential risks include high debt levels and net income decline, while positives are strong revenue growth and stable distributions. The short-term surge might be limited due to the sell rating and moderate price target. However, if the company continues to beat estimates or there's positive news on demand, the stock could see a rally. Need to present this balanced view with supporting data. ``` ### Conclusion 🎯 **USA Compression (USAC)** presents a mixed picture for short-term upside potential. While the company delivered **Q2 2025 earnings beats** with record revenues and stable distributions, **analyst skepticism** (Sell rating) and **moderate price target** ($25 vs. current $24.06) temper bullish sentiment. The stock’s **low volatility** (0.67% weekly) and **high-yield profile** (8.98% annualized) make it attractive for income-focused investors, but **operational risks** (net income decline, high debt) and **mixed analyst sentiment** warrant caution. --- ### Analysis 📊 #### 1. **Recent Performance & Key Metrics** | Metric | Q2 2025 Actual | Q2 2024 Actual | Year-over-Year Change | |----------------------------|-----------------|-----------------|------------------------| | **Revenue** | $250.1M | $235.3M | +6.3% | | **EPS** | $0.22 | $0.21 | +4.8% | | **Net Income** | $28.6M | $31.2M | -8.3% | | **Distributable Cash Flow**| $89.9M | $85.9M | +4.7% | **Key Takeaway**: USAC exceeded revenue and EPS estimates but saw a net income decline, likely due to higher costs and debt servicing. The **1.4X distribution coverage** remains stable, supporting its high-yield appeal . --- #### 2. **Analyst Sentiment & Valuation** | Metric | Data (as of 2025-08-25) | |----------------------------|---------------------------| | **Consensus Rating** | Sell | | **Average Price Target** | $25 | | **Current Price** | $24.06 | | **Upside Potential** | ~4.0% | **Key Takeaway**: Analysts are cautiously optimistic, with a **$25 price target** reflecting limited upside. The **Sell rating** highlights concerns about debt levels ($2.5B long-term debt ) and profit margins. --- #### 3. **Risks & Catalysts** | Risk/Catalyst | Details | |----------------------------|--------------------------| | **Positive Catalyst** | Record revenue growth (+6.3% YoY), stable distributions ($0.525/unit). | | **Negative Risk** | High leverage (4.0x debt/EBITDA ), net income decline (-8.3% YoY). | | **Market Catalyst** | Natural gas demand growth, data center-driven compression needs . | **Key Takeaway**: USAC’s **operational resilience** in a tight compression market could drive short-term gains, but **debt concerns** and **profitability pressures** pose headwinds. --- #### 4. **Short-Term Outlook** | Metric | Q3 2025 Estimates | |----------------------------|---------------------| | **EPS** | $0.23 | | **Revenue** | $246.98M | | **Price Target** | $25 | **Key Takeaway**: With a **$25 price target** and **low volatility** (0.67% weekly ), USAC is unlikely to surge sharply in the short term. However, **beat-and-raise scenarios** (e.g., higher revenue per horsepower) could trigger upside. --- ### Final Takeaway 🎯 USA Compression is a **hold for income investors** with a **neutral outlook** for short-term price action. While the stock offers **high yield** and **operational stability**, **analyst skepticism** and **debt risks** limit upside potential. Monitor **Q3 2025 results** and **natural gas demand trends** for catalysts.