Data center demand and the growth potential of electric power generation services are favored by Morgan Stanley on Liberty Energy (LBRT.US).

Liberty Energy (LBRT.US) stock price rose on Thursday after Morgan Stanley analyst Daniel Kutz upgraded the stock from "hold" to "buy" and raised the target price from $20 to $25. The analyst's optimism stems from the profit potential of the new Power Generation Services (PGS) business, which the market seems to have not fully recognized the value of. Furthermore, the analyst added that the fundamentals of the Completion Services (CS business) may be bottoming out as the market may be underestimating the possibility of reduced fracking equipment supply, and natural gas demand growth should eventually provide support for business activity and prices. Kutz also emphasized that the company offers investment opportunities benefiting from the growth in data centers and power demand at reasonable prices. The analyst also noted that Liberty Energy's management has a good track record of effectively allocating capital and timely investments. In addition, Kutz stated that market concerns about the sustainability of profits in the power generation services business, such as contract signings, equipment utilization rates, competition, and earnings per share/free cash flow, appear to be exaggerated. Liberty Energy's stock rose 5.19% to $16.22 on Thursday.