Argan, Inc. (NYSE:AGX) Given Average Rating of "Moderate Buy" by Brokerages

Key Points

• Argan has a consensus analyst rating of “Moderate Buy” from eight covering analysts, with an average 1-year price target of $470.40. Recent ratings were mixed but generally constructive, including upgrades from JPMorgan and Wall Street Zen.
• The company recently reported strong quarterly earnings, posting $3.24 EPS versus estimates of $2.31 and revenue of $290.95 million, up 50.2% year over year. Argan also beat expectations on profitability, with a net margin of 15.48% and ROE of 36.89%.
• Argan announced a $200 million share repurchase program and a quarterly dividend of $0.50 per share, payable July 31. The company has also seen notable insider selling and significant institutional ownership, with institutions holding 79.43% of shares.

Shares of Argan, Inc. (NYSE:AGX - Get Free Report) have been given a consensus rating of "Moderate Buy" by the eight analysts that are covering the stock, Marketbeat.com reports. Three analysts have rated the stock with a hold rating, four have issued a buy rating and one has given a strong buy rating to the company. The average 1-year price objective among analysts that have covered the stock in the last year is $470.40.

A number of analysts have issued reports on AGX shares. JPMorgan Chase & Co. raised shares of Argan from a "neutral" rating to an "overweight" rating and set a $550.00 price objective for the company in a report on Friday, March 27th. The Goldman Sachs Group lifted their price target on shares of Argan from $399.00 to $518.00 and gave the company a "buy" rating in a research report on Friday, March 27th. Weiss Ratings reiterated a "buy (b)" rating on shares of Argan in a research note on Thursday, July 2nd. Wall Street Zen raised Argan from a "hold" rating to a "buy" rating in a research report on Saturday, March 28th. Finally, Lake Street Capital increased their price target on Argan from $375.00 to $600.00 and gave the stock a "hold" rating in a research report on Friday, June 5th.

Argan Trading Up 0.2%

NYSE:AGX opened at $548.54 on Friday. The stock has a market cap of $7.69 billion, a P/E ratio of 48.20 and a beta of 0.57. The stock has a 50 day simple moving average of $679.76 and a 200 day simple moving average of $539.85. Argan has a 1-year low of $196.90 and a 1-year high of $805.75.

Argan (NYSE:AGX - Get Free Report) last released its quarterly earnings results on Thursday, June 4th. The construction company reported $3.24 EPS for the quarter, beating the consensus estimate of $2.31 by $0.93. Argan had a net margin of 15.48% and a return on equity of 36.89%. The business had revenue of $290.95 million for the quarter, compared to the consensus estimate of $256.03 million. During the same period in the prior year, the company posted $1.60 earnings per share. Argan's revenue was up 50.2% compared to the same quarter last year. As a group, sell-side analysts forecast that Argan will post 12.6 EPS for the current year.

Argan announced that its board has initiated a stock repurchase program on Wednesday, April 8th that authorizes the company to buyback $200.00 million in outstanding shares. This buyback authorization authorizes the construction company to repurchase up to 2.5% of its shares through open market purchases. Shares buyback programs are generally an indication that the company's board believes its stock is undervalued.

Argan Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, July 31st. Stockholders of record on Thursday, July 23rd will be issued a dividend of $0.50 per share. This represents a $2.00 annualized dividend and a dividend yield of 0.4%. The ex-dividend date of this dividend is Thursday, July 23rd. Argan's dividend payout ratio is 17.57%.

Insider Buying and Selling

In related news, Director William F. Leimkuhler sold 5,000 shares of the business's stock in a transaction dated Tuesday, April 28th. The stock was sold at an average price of $617.41, for a total value of $3,087,050.00. Following the completion of the transaction, the director owned 36,495 shares of the company's stock, valued at $22,532,377.95. The trade was a 12.05% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, Director Peter W. Getsinger sold 4,728 shares of the company's stock in a transaction dated Tuesday, June 16th. The stock was sold at an average price of $708.65, for a total transaction of $3,350,497.20. Following the sale, the director directly owned 6,880 shares of the company's stock, valued at $4,875,512. This represents a 40.73% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 151,309 shares of company stock valued at $102,366,655 in the last ninety days. Insiders own 6.69% of the company's stock.

Institutional Inflows and Outflows

Institutional investors have recently added to or reduced their stakes in the company. Maverick Capital Ltd. purchased a new stake in Argan in the fourth quarter valued at approximately $137,503,000. First Trust Advisors LP grew its position in shares of Argan by 32.1% during the first quarter. First Trust Advisors LP now owns 791,353 shares of the construction company's stock worth $431,010,000 after acquiring an additional 192,204 shares during the last quarter. Balyasny Asset Management L.P. grew its position in shares of Argan by 168.9% during the second quarter. Balyasny Asset Management L.P. now owns 253,365 shares of the construction company's stock worth $55,862,000 after acquiring an additional 159,149 shares during the last quarter. Invesco Ltd. increased its holdings in shares of Argan by 172.5% in the 2nd quarter. Invesco Ltd. now owns 229,893 shares of the construction company's stock valued at $50,687,000 after acquiring an additional 145,516 shares during the period. Finally, Epoch Investment Partners Inc. acquired a new position in shares of Argan in the 3rd quarter valued at $34,647,000. 79.43% of the stock is currently owned by institutional investors and hedge funds.

Argan Company Profile

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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