Key Highlights
- AGX climbed approximately 10% in pre-market trading following a Q4 EPS report of $3.47 that surpassed the $2.13 consensus estimate by $1.34
- Quarterly revenue reached $262.1M, representing a 12.7% year-over-year increase, though marginally under the $271M projection
- Fiscal year 2026 EPS achieved $9.74 compared to $6.15 in FY25; gross margin improved to 25% from 20.5%
- Contract backlog expanded dramatically to $2.9B from $1.4B year-over-year following $2.5B in fresh contract awards
- Argan closed the fiscal year with $895M in cash reserves and maintained a debt-free status; FY27 revenue outlook of $415M–$440M exceeded the $385.68M consensus forecast
Argan delivered an adjusted Q4 EPS of $3.47, significantly surpassing the analyst consensus of $2.13. This represents a substantial outperformance of $1.34 per share — the type of figure that captures immediate market attention.
Quarterly revenue totaled $262.1 million, reflecting a 12.7% increase from the $232.5 million recorded in the comparable period last year. While this figure came in slightly below the anticipated $271 million, market participants clearly prioritized the impressive profitability narrative.
Gross profit margin improved to 25% during Q4, representing an expansion from the 20.5% recorded twelve months prior. Net income climbed to $49.2 million, compared with $31.4 million in the corresponding quarter last year.
CEO David Watson characterized it as a “record fourth quarter” that concluded what he termed a year marked by robust operational execution. The annual performance substantiated this assessment.
For the full fiscal year 2026, Argan posted revenue of $944.6 million, marking an 8.1% year-over-year advancement. Annual EPS registered at $9.74, up substantially from $6.15 in FY25. EBITDA climbed to $162.8 million versus $113.5 million in the preceding year.
The most impressive metric may well be the contract backlog. It skyrocketed to approximately $2.9 billion as of January 31, 2026, more than doubling from $1.4 billion twelve months earlier. This substantial growth materialized after the company secured $2.5 billion in new contract awards throughout FY26.
Watson attributed the surge in new contracts to robust demand stemming from AI data center development, electrification initiatives, and the need to modernize aging power generation infrastructure.
Financial Position and Shareholder Returns
Argan concluded the fiscal year with a robust financial foundation. The company maintained $895 million in cash, cash equivalents, and investment holdings, up significantly from $525.1 million one year prior. Net liquidity positioned itself at $421 million.
The balance sheet carries zero debt obligations.
Additionally, the company increased its quarterly dividend distribution to $0.50 per share in FY26, marking the third straight year of dividend enhancements.
A significant factor contributing to Q4 profitability was reaching substantial completion ahead of schedule at the Trumbull Energy Center — an achievement that provided meaningful support to gross margins during the quarter.
Fiscal 2027 Projections
For the upcoming fiscal year, Argan provided FY27 revenue guidance ranging from $415 million to $440 million. This projection exceeds the Wall Street consensus estimate of $385.68 million.
Adjusted EBITDA for FY27 is projected to fall within a range of $0 to $10 million. CFO Baugher indicated that providing precise visibility on FY27 gross margin expectations remains premature at this stage.
Management anticipates securing additional projects throughout the coming 12 to 20 months.
AGX traded around $450 during pre-market hours on March 27, representing an approximate 10% gain for the session. The stock had already demonstrated momentum, appreciating roughly 12.6% over the preceding month and approximately 3.15% during the past week.
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