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Argan
(NYSE:AGX)
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Rating:76Outperform
Price Target:
$401.00
▼(-11.90% Downside)
Action:Reiterated
Date:09/10/26
AGX scores well overall primarily due to standout financial performance (strong growth, expanding margins, high returns, and a near debt-free balance sheet with strong cash conversion). The score is held back by weak technicals (price below key moving averages with bearish momentum) and a mixed valuation profile (elevated P/E with a modest yield). Earnings call commentary remains supportive on full-year outlook and demand, but near-term margin/backlog and Industrial variability temper the rating.
Positive Factors
Strong Revenue and Margin Expansion
Rapid revenue growth alongside expanding net and operating margins indicates stronger project scale and execution economics. If these gains persist, Argan can convert rising demand into greater earnings capacity while using operating leverage to support continued investment and competitive positioning.
Negative Factors
Declining Committed Backlog
A lower committed backlog reduces forward revenue protection and places greater importance on winning and starting new projects. Although backlog remained substantial, continued reductions could create a gap between current execution and future growth, particularly because large contracts are completed unevenly.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Revenue and Margin Expansion
Rapid revenue growth alongside expanding net and operating margins indicates stronger project scale and execution economics. If these gains persist, Argan can convert rising demand into greater earnings capacity while using operating leverage to support continued investment and competitive positioning.
Read all positive factors
Argan Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows how Argan’s sales are split across regions, highlighting dependence on particular markets for power-plant construction and services. Reveals where growth or slowdown risks lie, and how regional regulation, permitting, or local demand could affect future cash flow.
Shows how Argan’s sales are split across regions, highlighting dependence on particular markets for power-plant construction and services. Reveals where growth or slowdown risks lie, and how regional regulation, permitting, or local demand could affect future cash flow.
Data provided by:
The Fly
The FlyArgan (AGX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.39B
Dividend Yield0.52%
Average Volume (3M)402.93K
Price to Earnings (P/E)29.8
Beta (1Y)1.34
Revenue Growth29.02%
EPS Growth49.57%
CountryUS
Employees1,409
SectorIndustrials
Sector Strength72
IndustryEngineering & Construction
Share Statistics
EPS (TTM)12.86
Shares Outstanding14,029,842
10 Day Avg. Volume383,231
30 Day Avg. Volume402,929
Financial Highlights & Ratios
PEG Ratio0.60
Price to Book (P/B)10.43
Price to Sales (P/S)5.11
P/FCF Ratio11.74
Enterprise Value/Market Cap1.31
Enterprise Value/Revenue5.94
Enterprise Value/Gross Profit28.49
Enterprise Value/Ebitda32.39
Forecast
1Y Price Target
$502.08Price Target Upside10.31% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)13.04
Revenue Forecast (FY)$1.38B
Argan Business Overview & Revenue Model
Company Description
Argan, Inc., operating through its various subsidiaries, offers a comprehensive suite of services to the power generation and renewable energy sectors. These services span engineering, procurement, construction (EPC), commissioning, operations man...
How the Company Makes Money
Argan makes money primarily by contracting to deliver energy and industrial infrastructure projects and recognizing revenue as work is performed under those contracts. Its core revenue stream comes from EPC/project delivery services for power gene...
Argan Earnings Call Summary
Earnings Call Date:Sep 02, 2026
(Q2-2027)
| % Change Since: |
Next Earnings Date:Dec 09, 2026
Earnings Call Sentiment Positive
The call was strongly positive overall, supported by record quarterly revenue, net income and adjusted EBITDA, substantial year-over-year growth across all segments, strong demand and pipeline commentary, a solid balance sheet, shareholder returns and progress on major projects. The main concerns were the decline in reported backlog, sequential consolidation margin compression, below-expectation Industrial margins, anticipated lower Industrial revenue and limited potential sequential growth in the third quarter.Positive Updates
Record Quarterly Revenue and Earnings
Second-quarter consolidated revenue reached a record $384 million, up 62% from $237.7 million in the comparable fiscal 2026 quarter. Record net income was $53.3 million, or $3.76 per diluted share, compared with $35.3 million, or $2.50 per diluted share, in the prior-year quarter.
Negative Updates
Consolidated Backlog Decline
Consolidated backlog decreased from $2.9 billion at the start of fiscal 2027 to $2.5 billion at July 31, 2026. Management noted that backlog can fluctuate quarter to quarter based on project completion and the timing of pending project starts.
Read all updates
Q2-2027 Updates
Positive
Negative
Record Quarterly Revenue and Earnings
Second-quarter consolidated revenue reached a record $384 million, up 62% from $237.7 million in the comparable fiscal 2026 quarter. Record net income was $53.3 million, or $3.76 per diluted share, compared with $35.3 million, or $2.50 per diluted share, in the prior-year quarter.
Read all positive updates
Company Guidance
Management expects to add a handful of new projects over the next 7 to 15 months and remains positioned to execute on 10 to 12 jobs simultaneously, with complex combined cycle projects representing the majority of backlog for the near and midterm; the North Carolina fabrication facility is expected to be complete in Q3 and to generate around $10-plus million a quarter in industrial revenues later this year and into the next year. Industrial margins may run below historical norms for a quarter or 2, while fiscal year '27 is expected to be significantly above fiscal year '26, with limited quarter over consecutive quarter growth in Q3 and decreased industrial revenues compared to Q2 for the rest of the year; Teledata revenues are expected to potentially double revenues from fiscal year '26 and drive EBITDA growth over the next couple of quarters and beyond.Argan Financial Statement Overview
Summary
Income Statement
90
Very Positive
Balance Sheet
94
Very Positive
Cash Flow
86
Very Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.19B | 944.61M | 874.18M | 573.33M | 455.04M | 509.37M |
| Gross Profit | 247.88M | 193.68M | 140.99M | 80.83M | 86.36M | 99.73M |
| EBITDA | 218.04M | 162.80M | 116.86M | 51.34M | 49.72M | 56.65M |
| Net Income | 179.31M | 137.77M | 85.46M | 32.36M | 33.10M | 38.24M |
Balance Sheet | ||||||
| Total Assets | 1.40B | 1.19B | 836.23M | 598.23M | 489.49M | 553.59M |
| Cash, Cash Equivalents and Short-Term Investments | 1.03B | 894.98M | 525.14M | 412.40M | 325.46M | 440.50M |
| Total Debt | 0.00 | 6.39M | 2.71M | 2.73M | 1.57M | 1.37M |
| Total Liabilities | 894.13M | 724.09M | 484.37M | 307.29M | 208.59M | 227.99M |
| Stockholders Equity | 506.84M | 462.26M | 351.86M | 290.94M | 280.90M | 326.39M |
Cash Flow | ||||||
| Free Cash Flow | 545.70M | 410.84M | 161.00M | 114.10M | -33.43M | 26.99M |
| Operating Cash Flow | 555.18M | 414.72M | 167.58M | 116.86M | -30.06M | 28.41M |
| Investing Cash Flow | -298.51M | -182.02M | -193.62M | -67.61M | -63.12M | -7.04M |
| Financing Cash Flow | -69.39M | -42.59M | -26.06M | -26.05M | -82.80M | -34.61M |
Argan Technical Analysis
Negative
455.15
Price Trends
469.60
Negative
571.07
Negative
516.09
Negative
Market Momentum
-26.98
Negative
40.77
Neutral
65.72
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AGX, the sentiment is Negative. The current price of 455.15 is above the 20-day moving average (MA) of 387.05, below the 50-day MA of 469.60, and below the 200-day MA of 516.09, indicating a bearish trend. The MACD of -26.98 indicates Negative momentum. The RSI at 40.77 is Neutral, neither overbought nor oversold. The STOCH value of 65.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AGX.
Argan Risk Analysis
Argan disclosed 38 risk factors in its most recent earnings report. Argan reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Argan Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $5.39B | 29.85 | 38.51% | 0.52% | 29.02% | 49.57% | |
70 Outperform | $101.72B | 76.53 | 14.86% | 0.07% | 26.30% | 34.94% | |
66 Neutral | $4.75B | 28.67 | 24.17% | ― | 16.06% | 121.28% | |
65 Neutral | $17.34B | 34.00 | 15.30% | ― | 23.46% | 86.29% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
56 Neutral | $4.26B | 30.65 | 8.46% | 0.40% | 5.12% | -42.27% | |
50 Neutral | $6.67B | -4.14 | -57.08% | 6.65% | -4.77% | -151.32% |
* Industrials Sector Average
AGX
Argan
383.83
121.55
46.34%
FLR
Fluor
49.90
5.97
13.59%
MTZ
MasTec
215.93
-0.87
-0.40%
MYRG
MYR Group
304.77
105.10
52.64%
PRIM
Primoris Services
79.08
-59.97
-43.13%
PWR
Quanta Services
676.56
249.09
58.27%
Argan Corporate Events
Business Operations and StrategyDividends
Argan Boosts Quarterly Dividend Amid Ongoing Growth
Positive
Sep 9, 2026
On September 9, 2026, Argan, Inc. announced that its Board of Directors approved a 40% increase in the quarterly cash dividend, lifting the payout from $0.50 to $0.70 per common share. The higher dividend is scheduled to be paid on October 30, 202...
Business Operations and StrategyM&A Transactions
Argan’s SMC Acquires ValCor to Expand New England Presence
Positive
Aug 4, 2026
On August 4, 2026, Argan announced that its wholly owned subsidiary Southern Maryland Cable Inc. completed the acquisition of ValCor Communications, a Connecticut-based provider of installation, maintenance and repair services for information, com...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.