Industrial contractor Argan's Q3 revenue misses estimates
Argan's fiscal Q3 revenue declined by 2.3% year-over-year, missing analyst estimates, but net income rose to $30.7 million. The company reported a record backlog of $3.0 billion, driven by new gas-fired projects. Despite the revenue decline, gross profit margins improved. Analysts maintain a 'buy' rating, with a median 12-month price target of $370.00, 5.4% above the recent closing price. The stock trades at 39 times the next 12-month earnings.
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Overview
- Argan fiscal Q3 revenue declines 2.3% yr/yr, missing analyst expectations
- Net income for fiscal Q3 rises to $30.7 mln from $28.0 mln yr/yr
- Company reports record backlog of $3.0 bln, driven by new gas-fired projects
Outlook
- Company expects to add projects to backlog as construction progresses
- Argan anticipates revenue growth and enhanced profitability for years to come
Result Drivers
- RECORD BACKLOG - Driven by two new gas-fired projects in Texas, contributing to a backlog of $3.0 bln
- REVENUE DECLINE - Timing of work performed and project mix led to a 2.3% revenue decline
- IMPROVED MARGINS - Gross profit margins improved in Power Industry Services and Industrial Construction Services segments
Key Details
Metric Beat/Mis Actual Consensu
s s
Estimate
Q3 Miss $251.20 $263.84
Revenue mln mln (4
Analysts
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Q3 EPS $2.17
Q3 Net $30.70
Income mln
Q3 $40.30
EBITDA mln
Q3 Gross $46.90
Profit mln
Analyst Coverage
- The current average analyst rating on the shares is “buy” and the breakdown of recommendations is 3 “strong buy” or “buy”, 2 “hold” and no “sell” or “strong sell”
- The average consensus recommendation for the construction & engineering peer group is “buy”
- Wall Street’s median 12-month price target for Argan Inc is $370.00, about 5.4% above its December 3 closing price of $351.09
- The stock recently traded at 39 times the next 12-month earnings vs. a P/E of 30 three months ago
Press Release: For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact . (This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)
