Argan, Inc. AGX appears to be entering a new phase of growth, backed by a record project backlog and surging demand for reliable power infrastructure. The company ended fiscal 2026 with a consolidated backlog of nearly $2.9 billion, more than double the prior-year level of roughly $1.4 billion. This sharp increase reflects $2.5 billion in newly added contract value during the year and highlights strong customer demand across Argan’s Power, Industrial and Teledata segments.
The Power segment continues to drive the story. AGX secured several major gas-fired power plant projects in Texas and other regions, capitalizing on rising electricity demand fueled by AI data centers, EV adoption and manufacturing reshoring trends. Management believes the “electrification of everything” and years of underinvestment in grid infrastructure are creating a favorable long-term backdrop for new combined-cycle natural gas facilities.
Importantly, the company is not just winning projects; rather, it is executing them efficiently. Fiscal 2026 revenues rose 8% year over year to $944.6 million, while EBITDA climbed 43% to a record $162.8 million. Gross margin expanded to 20.5% from 16.1% a year ago, aided by strong project execution and early completion milestones on key projects like the Trumbull Energy Center.
Argan’s strong balance sheet further strengthens its growth outlook. The company ended the year with $895 million in cash and investments and no debt, giving it substantial flexibility to support large-scale EPC opportunities. While risks tied to supply-chain disruptions, labor shortages and project timing remain, Argan’s expanding backlog and disciplined bidding strategy position it well for sustained momentum in the years ahead.
Argan, MasTec & KBR: Who’s Winning the Power Boom Race?
Argan, alongside MasTec, Inc. MTZ and KBR, Inc. KBR, is benefiting from rising infrastructure investment, but each brings a different strength to the market.
MasTec offers broader infrastructure exposure, spanning renewable energy, oil and gas pipelines, wireless communications and power delivery systems. Its diversified operations position it well to benefit from long-term clean energy and telecom spending trends. Meanwhile, KBR focuses more on engineering, technology solutions and government-backed infrastructure projects, with strong exposure to energy transition, sustainable technologies and mission-critical communications systems.
While MasTec and KBR operate on a much larger global scale, Argan differentiates itself through disciplined project execution, high-margin power construction capabilities and a debt-free balance sheet. Together, all three companies are positioned to capitalize on increasing investment in power reliability, renewable integration, pipeline modernization and communications infrastructure expansion.
AGX Stock’s Price Performance & Valuation Trend
Shares of this Virginia-based engineering and construction company have soared 115% year to date, significantly outperforming the Zacks Building Products - Miscellaneous industry, the broader Zacks Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
AGX stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 52.28, as the trend lines suggest below.
Image Source: Zacks Investment Research
Earnings Estimate Trend of AGX
AGX’s earnings estimates for fiscal 2027 and fiscal 2028 have remained unchanged over the past 60 days at $11.44 and $15.95 per share, respectively. However, the estimates for fiscal 2027 and fiscal 2028 imply year-over-year growth of 17.5% and 39.5%, respectively.
Image Source: Zacks Investment Research
Argan currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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KBR, Inc. (KBR): Free Stock Analysis Report
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