Argan (NYSE:AGX) Upgraded to Buy at Wall Street Zen

Key Points

• Wall Street Zen upgraded Argan from “Hold” to “Buy,” while Lake Street also raised its rating to Buy with a $600 price target. Overall, analysts rate the stock “Moderate Buy,” with an average target of $470.40.
• Argan significantly beat fiscal second-quarter expectations, reporting $3.76 in EPS versus $2.64 expected and $383.98 million in revenue versus $300.53 million expected. Revenue grew 61.5% year over year, supported by power-segment growth, margin expansion and a backlog of roughly $2.5 billion.
• Insiders sold $87.6 million worth of shares over the past three months, including substantial sales by the chairman and a director. Management also cautioned that revenue growth could moderate due to project timing and execution.

Argan (NYSE:AGX - Get Free Report) was upgraded by analysts at Wall Street Zen from a "hold" rating to a "buy" rating in a research report issued to clients and investors on Saturday, Wall Street Zen reports.

Other analysts have also recently issued research reports about the stock. Zacks Research downgraded shares of Argan from a "strong-buy" rating to a "hold" rating in a research report on Friday, August 7th. Lake Street Capital raised shares of Argan from a "hold" rating to a "buy" rating and set a $600.00 target price for the company in a research report on Thursday. Finally, Weiss Ratings raised shares of Argan from a "buy (b-)" rating to a "buy (b)" rating in a research report on Thursday, August 27th. Five investment analysts have rated the stock with a Buy rating and three have given a Hold rating to the company. According to data from MarketBeat.com, the company presently has an average rating of "Moderate Buy" and an average price target of $470.40.

Argan Price Performance

Shares of NYSE:AGX opened at $417.52 on Friday. Argan has a 1 year low of $197.00 and a 1 year high of $805.75. The company has a market cap of $5.86 billion, a PE ratio of 33.03 and a beta of 0.57. The stock's 50-day moving average is $572.83 and its 200 day moving average is $583.47.

Argan (NYSE:AGX - Get Free Report) last posted its earnings results on Wednesday, September 2nd. The construction company reported $3.76 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.64 by $1.12. The firm had revenue of $383.98 million for the quarter, compared to analysts' expectations of $300.53 million. Argan had a return on equity of 38.51% and a net margin of 15.09%.The business's revenue was up 61.5% compared to the same quarter last year. During the same period in the previous year, the firm earned $2.50 earnings per share. Analysts expect that Argan will post 12.6 EPS for the current fiscal year.

Insider Activity

In related news, Chairman William F. Griffin, Jr. sold 50,000 shares of the stock in a transaction dated Friday, June 12th. The shares were sold at an average price of $643.46, for a total transaction of $32,173,000.00. Following the sale, the chairman directly owned 90,976 shares of the company's stock, valued at approximately $58,539,416.96. This represents a 35.47% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, Director Cynthia Flanders sold 2,596 shares of the firm's stock in a transaction dated Monday, June 15th. The shares were sold at an average price of $666.31, for a total transaction of $1,729,740.76. Following the sale, the director owned 23,144 shares of the company's stock, valued at approximately $15,421,078.64. This represents a 10.09% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last three months, insiders sold 127,973 shares of company stock valued at $87,554,828. 2.99% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Argan

A number of institutional investors have recently made changes to their positions in the company. Western Wealth Management LLC purchased a new position in Argan in the 1st quarter worth approximately $25,000. Public Employees Retirement System of Ohio bought a new position in Argan in the 2nd quarter valued at approximately $38,000. SJS Investment Consulting Inc. boosted its stake in Argan by 2,950.0% during the 1st quarter. SJS Investment Consulting Inc. now owns 61 shares of the construction company's stock valued at $33,000 after purchasing an additional 59 shares during the last quarter. Plato Investment Management Ltd purchased a new stake in Argan during the 2nd quarter valued at $52,000. Finally, University of Texas Texas AM Investment Management Co. bought a new stake in shares of Argan in the 4th quarter worth $30,000. Hedge funds and other institutional investors own 79.43% of the company's stock.

Argan News Roundup

Here are the key news stories impacting Argan this week:

• Positive Sentiment: Lake Street upgraded AGX to Buy from Hold and set a $600 price target, citing improved fundamentals and growth prospects. Based on the referenced price of $417.52, the target implies substantial potential upside. Lake Street upgrades Argan to Buy from Hold
• Positive Sentiment: Argan’s fiscal second-quarter results significantly exceeded expectations. Earnings per share came in at $3.76 versus the $2.64 consensus estimate, while revenue reached $383.98 million compared with expectations of $300.53 million. Revenue increased 61.5% year over year, and the company reported a 15.09% net margin and 38.51% return on equity. Why Argan Stock Just Popped
• Positive Sentiment: Power-segment growth and margin expansion strengthened the outlook. Analysts highlighted approximately 53% Power revenue growth, solid project margins and a backlog of roughly $2.5 billion. Demand tied to electrification, data centers and domestic manufacturing could support continued demand for Argan’s power-infrastructure construction services. Argan Stock Rises on Q2 Earnings and Revenue Beat
• Neutral Sentiment: Management pointed to a strong gas-project pipeline and plans to expand capacity, but cautioned that revenue growth may moderate in the near term as project timing and execution affect results. Argan Q2 Earnings Call Highlights

About Argan

Argan, Inc NYSE: AGX is a holding company that provides professional technical and management services to the power generation and renewable energy industries. Through its wholly owned subsidiaries, the company delivers engineering, procurement and construction management (EPCM), commissioning and operations and maintenance (O&M) services for a broad range of energy facilities. Argan focuses on projects for utility, industrial and municipally owned clients, helping to bring efficient thermal and renewable energy plants into operation and maintain optimal performance over the asset life cycle.

The company's principal subsidiaries include Gemma Power Systems, which specializes in turnkey construction of combined-cycle, simple-cycle, cogeneration and renewable energy plants; Atlantic Projects Company, which provides electrical balance-of-plant, control systems, instrumentation and commissioning services; and Infrastructure Solutions, which offers industrial maintenance, outage support and modification services.

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