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

Key Points

• Moderate Buy consensus from nine analysts (4 hold, 4 buy, 1 strong buy) with an average 12‑month price target of $425.40, notably below the stock's recent open near $697.63.
• Argan beat Q1 estimates with EPS $3.47 vs. $1.99 expected and revenue of $262.1M (up 12.7% YoY); analysts expect about $11.44 EPS for the fiscal year.
• The board approved a $200 million share buyback (up to 2.5% of shares) and paid a $0.50 quarterly dividend (annualized $2.00, yield 0.3%), while insiders sold roughly $39M of stock in the past three months.

Shares of Argan, Inc. (NYSE:AGX - Get Free Report) have received a consensus recommendation of "Moderate Buy" from the nine analysts that are presently covering the firm, Marketbeat Ratings reports. Four analysts have rated the stock with a hold recommendation, four have given a buy recommendation and one has assigned a strong buy recommendation to the company. The average twelve-month price target among analysts that have updated their coverage on the stock in the last year is $425.40.

Several brokerages have recently weighed in on AGX. The Goldman Sachs Group increased their price objective on shares of Argan from $399.00 to $518.00 and gave the stock a "buy" rating in a report on Friday, March 27th. Wall Street Zen upgraded shares of Argan from a "hold" rating to a "buy" rating in a report on Saturday, March 28th. JPMorgan Chase & Co. upgraded shares of Argan from a "neutral" rating to an "overweight" rating and set a $550.00 price objective on the stock in a report on Friday, March 27th. Zacks Research upgraded shares of Argan from a "hold" rating to a "strong-buy" rating in a report on Tuesday, March 31st. Finally, Lake Street Capital increased their price objective on shares of Argan from $325.00 to $375.00 and gave the stock a "hold" rating in a report on Friday, March 27th.

Argan Price Performance

Shares of AGX stock opened at $697.63 on Tuesday. The firm has a market cap of $9.73 billion, a P/E ratio of 71.63 and a beta of 0.61. Argan has a 1-year low of $157.88 and a 1-year high of $715.98. The firm's 50-day simple moving average is $527.67 and its 200-day simple moving average is $406.51.

Argan (NYSE:AGX - Get Free Report) last announced its quarterly earnings data on Thursday, March 26th. The construction company reported $3.47 earnings per share for the quarter, topping the consensus estimate of $1.99 by $1.48. The business had revenue of $262.05 million for the quarter, compared to analyst estimates of $255.32 million. Argan had a net margin of 14.59% and a return on equity of 33.62%. The company's revenue was up 12.7% on a year-over-year basis. During the same period in the prior year, the firm posted $2.22 EPS. Analysts expect that Argan will post 11.44 earnings per share for the current fiscal year.

Argan declared that its board has approved a stock buyback plan on Wednesday, April 8th that allows the company to repurchase $200.00 million in outstanding shares. This repurchase authorization allows the construction company to buy up to 2.5% of its stock through open market purchases. Stock repurchase plans are typically a sign that the company's board believes its stock is undervalued.

Argan Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, April 30th. Investors of record on Wednesday, April 22nd were issued a $0.50 dividend. The ex-dividend date was Wednesday, April 22nd. This represents a $2.00 annualized dividend and a yield of 0.3%. Argan's dividend payout ratio (DPR) is presently 20.53%.

Insider Transactions at Argan

In related news, Director William F. Leimkuhler sold 8,444 shares of the firm's stock in a transaction that occurred on Monday, April 13th. The shares were sold at an average price of $598.49, for a total value of $5,053,649.56. Following the transaction, the director owned 41,495 shares in the company, valued at approximately $24,834,342.55. This trade represents a 16.91% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is accessible through the SEC website. Also, CEO David Hibbert Watson sold 19,310 shares of the firm's stock in a transaction that occurred on Friday, April 17th. The shares were sold at an average price of $602.11, for a total transaction of $11,626,744.10. Following the completion of the transaction, the chief executive officer owned 49,998 shares in the company, valued at $30,104,295.78. The trade was a 27.86% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 64,543 shares of company stock valued at $39,054,956 in the last three months. 6.69% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Hedge funds have recently bought and sold shares of the business. SJS Investment Consulting Inc. raised its holdings in Argan by 2,950.0% in the first quarter. SJS Investment Consulting Inc. now owns 61 shares of the construction company's stock valued at $33,000 after buying an additional 59 shares during the period. Aster Capital Management DIFC Ltd purchased a new stake in shares of Argan during the third quarter valued at approximately $25,000. University of Texas Texas AM Investment Management Co. purchased a new stake in shares of Argan during the fourth quarter valued at approximately $30,000. Montag A & Associates Inc. purchased a new stake in shares of Argan during the fourth quarter valued at approximately $30,000. Finally, Hilton Head Capital Partners LLC purchased a new stake in shares of Argan during the fourth quarter valued at approximately $31,000. Hedge funds and other institutional investors own 79.43% of the company's stock.

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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