Overview

* Argan, which provides services in power industry, posts 4.7% rise in Q2 revenue, but misses analyst expectations

* Adjusted EPS for fiscal Q2 was $2.50

* Company reports record project backlog of $2.0 bln

Outlook

* Argan sees strong demand for capabilities across all business segments

* Company positioned to benefit from demand for reliable energy resources

* Argan expects to capitalize on electrification and power grid needs

Result Drivers

* PROJECT ACTIVITY - Increased project activity and higher contract backlog drove revenue growth, despite missing analyst expectations

* GROSS MARGIN IMPROVEMENT - Improved gross profit margins in Power Industry Services segment contributed to higher gross profit

* PROJECT MILESTONES - Completion of LNG project and progress in renewable projects supported results, aided by favorable weather conditions

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Miss $237.70 $244 mln

Revenue mln (3

Analysts

)

Q2 EPS $2.5

Q2 Net $35.30

Income mln

Q2 $36.20

EBITDA mln

Q2 Gross $44.30

Profit mln

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 1 "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 ( AGX ) is $228.00, about 0.4% above its September 3 closing price of $227.03

* The stock recently traded at 30 times the next 12-month earnings vs. a P/E of 34 three months ago

Press Release:

(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.)