Argan Inc. Common Stock (AGX)

FairStock Score: 52/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a value investor, I look first at business quality and staying power. Argan is an EPC contractor for power generation. The filed numbers show real momentum: in fiscal Q2 2026, the quarter ended 2026-07-31, revenue was $384.0M and net income $53.3M, up from $237.7M and $35.3M in fiscal Q2 2025, the quarter ended 2025-07-31. That is roughly 62% revenue growth and 51% net income growth. For FY2025, the year ended 2026-01-31, revenue was $944.6M and net income $137.8M, versus FY2024, the year ended 2025-01-31, revenue of $874.2M and net income of $85.5M. The balance sheet looks conservative: debt-to-equity is 0.02, and FairStock calculates Altman Z-Score at 4.93. FairStock calculations put ROE at 39.85% and ROCE at 9.99%; the high ROE is excellent, but ROCE below 10% suggests the return may depend on low book capital. Free cash flow is strong at $545.7M trailing twelve months, a 10.0% FCF yield at the 2026-10-13 close. Valuation asks a lot: FairStock calculations put P/E at 30.63, P/B at 10.74, EV/EBITDA at 26.39, and Graham Number at $101.47, leaving a -282.48% margin of safety. The PEG ratio is 0.60, and the Lynch category is FAST GROWER, with profit growing 42.0% a year over five years and revenue 19.2%. Yet EPC work is cyclical and competitive; Piotroski F-Score is 5/9, and no wide moat is evident from these figures. At $388.10, this is a good operating business with strong growth, low debt, and high cash generation, but the price already discounts much future success. I would want a wider margin of safety before calling it a bargain.

In plain English: Argan is an engineering and construction company that builds power generation projects. The business looks strong right now: in its fiscal Q2 2026, the quarter ended 2026-07-31, revenue was $384.0 million and net income was $53.3 million, both much higher than the same quarter a year earlier. But the stock price of $388.10 on October 13, 2026 looks expensive compared with the company's assets and a conservative estimate of its earnings power, even though growth has been fast.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-07-31) · fiscal Q1 2026 10-Q (period ended 2026-04-30) · fiscal Q3 2025 10-Q (period ended 2025-10-31) · fiscal Q2 2025 10-Q (period ended 2025-07-31) · FY2025 10-K (period ended 2026-01-31) · FY2024 10-K (period ended 2025-01-31) · FY2023 10-K (period ended 2024-01-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer