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AGX

Argan NYSE:AGX Stock Report

Last Price

US$32.31

Market Cap

US$448.6m

7D

-1.3%

1Y

-26.0%

Updated

29 Sep, 2022

Data

Company Financials +
AGX fundamental analysis
Snowflake Score
Valuation4/6
Future Growth5/6
Past Performance1/6
Financial Health6/6
Dividends4/6

AGX Stock Overview

Argan, Inc., through its subsidiaries, provides engineering, procurement, construction, commissioning, operations management, maintenance, project development, technical, and consulting services to the power generation and renewable energy markets.

Argan, Inc. Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Argan
Historical stock prices
Current Share PriceUS$32.31
52 Week HighUS$46.24
52 Week LowUS$31.26
Beta0.51
1 Month Change-7.18%
3 Month Change-14.73%
1 Year Change-26.01%
3 Year Change-14.27%
5 Year Change-51.99%
Change since IPO-59.93%

Recent News & Updates

Sep 12
Argan's (NYSE:AGX) Dividend Will Be $0.25

Argan's (NYSE:AGX) Dividend Will Be $0.25

Argan, Inc. ( NYSE:AGX ) will pay a dividend of $0.25 on the 31st of October. This means the annual payment is 2.9% of...

Sep 08

Argan: Assessing If Strong Potential Can Be Realized

Summary Argan remains profitable from a reported earnings standpoint but not on a cash basis. The market is still not rewarding the stock for new projects such as multiple power projects in Ireland. Bulls are expecting long-term support to hold here if indeed the $30 level gets tested. Intro If we pull up a chart of Argan, Inc. (AGX) (Engineering & Construction Player), we can see that shares now look likely that they will test underside support in this latest downswing. Momentum remains clearly to the downside with shares continuing to trade well below their 200-day moving average ($37.80). Suffice it to say, the first quarter earnings and revenue beats that were announced in June of this year did little to stem the tide in this play. The big calling cards in Argan are its valuation and the projects it has coming down the track specifically. For example, the company's Non-GAAP forward earnings multiple comes in at an ultra-low 12.02. This multiple looks particularly attractive compared to Argan's 5-year average of 26.20 for example. Furthermore, if we go out to the fiscal year ending in January 2024, the forward price-to-earnings ratio comes in even lower close to the 9 mark. Suffice it to say, consensus is pricing in plenty of growth in Argan which if realized should undoubtedly lift the share price over time. Argan Shares Continue To Slide (Stockcharts.com) We must remember that forward-looking numbers are estimates and could easily miss the mark by quite some margin. We state this because bottom-line near-term quarterly estimates (which are much easier to predict) have been falling sharply, so if this trend persists, those annual earnings multiples could increase much faster than many presently expect. Furthermore, there is another problem that investors should focus on: Argan's cash flow. Although Argan may look very attractive from its cash position ($367 million of cash & short-term investments where the market cap present is only a mere $455 million), the company has not been generating cash flow for a while. This presents a problem for the following reason. Argan Quarterly Earnings Estimates (Seeking Alpha) Negative Cash-Flow Argan's trailing net profit number of $35 million may demonstrate that the company remains healthily profitable but $35 million of net profit over the past four quarters does not mean that this amount was available to shareholders in the form of buybacks or dividends. This is an important distinction in that the income statement is an accounting document whereas the company's cash-flow statement illustrates the actual movement of cash in and out of the business over a specified period. Suffice it to say, if we go to Argan's cash-flow statement, we see a negative operating cash flow of $28 million (Another way of valuing the stock) which means the company is not profitable on a cash basis. Balance sheet cash was reduced by over $200 million (Mostly investments) and shareholder equity lost roughly $29 million in this timeframe. Although bulls will point to the underlying strength of Argan's balance sheet ($302.8 million of equity versus total liabilities of $190.8 million) and really encouraging forward-looking expectations concerning multiple profitable projects, long-term investors who look for stability invariably focus on cash-flow growth. The reason being is that solid cash-flow generation invariably leads to increased assets and revenues. Suffice it to say, when there is a lack of free cash flow over a sustained period, the company needs to rely on its balance sheet and organic growth to resume growth. This reduces the opportunity to grow and you can bet the market has been pricing this into the prevailing share price. Argan's forward dividend yield presently comes in at roughly 3% and the stated payout ratio is roughly 36%. That payout ratio is calculated off earnings and not cash, so if negative cash flow continues to be the order of the day for some time, management will have to continue to lean on its balance sheet to reward shareholders.

Shareholder Returns

AGXUS ConstructionUS Market
7D-1.3%-4.5%-3.1%
1Y-26.0%1.8%-21.5%

Return vs Industry: AGX underperformed the US Construction industry which returned 2.6% over the past year.

Return vs Market: AGX underperformed the US Market which returned -20.3% over the past year.

Price Volatility

Is AGX's price volatile compared to industry and market?
AGX volatility
AGX Average Weekly Movement4.1%
Construction Industry Average Movement5.3%
Market Average Movement6.9%
10% most volatile stocks in US Market15.7%
10% least volatile stocks in US Market2.8%

Stable Share Price: AGX is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: AGX's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19611,358David Watsonhttps://www.arganinc.com

Argan, Inc., through its subsidiaries, provides engineering, procurement, construction, commissioning, operations management, maintenance, project development, technical, and consulting services to the power generation and renewable energy markets. The company operates through Power Industry Services, Industrial Fabrication and Field Services, and Telecommunications Infrastructure Services segments. The Power Industry Services segment offers engineering, procurement, and construction contracting services to the owners of alternative energy facilities, such as biomass plants, wind farms, and solar fields; and design, construction, project management, start-up, and operation services for projects with approximately 15 gigawatts of power-generating capacity.

Argan, Inc. Fundamentals Summary

How do Argan's earnings and revenue compare to its market cap?
AGX fundamental statistics
Market CapUS$448.60m
Earnings (TTM)US$26.32m
Revenue (TTM)US$468.41m

17.0x

P/E Ratio

1.0x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
AGX income statement (TTM)
RevenueUS$468.41m
Cost of RevenueUS$378.02m
Gross ProfitUS$90.39m
Other ExpensesUS$64.08m
EarningsUS$26.32m

Last Reported Earnings

Jul 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)1.90
Gross Margin19.30%
Net Profit Margin5.62%
Debt/Equity Ratio0%

How did AGX perform over the long term?

See historical performance and comparison

Dividends

3.1%

Current Dividend Yield

57%

Payout Ratio

Does AGX pay a reliable dividends?

See AGX dividend history and benchmarks
When do you need to buy AGX by to receive an upcoming dividend?
Argan dividend dates
Ex Dividend DateOct 20 2022
Dividend Pay DateOct 31 2022
Days until Ex dividend19 days
Days until Dividend pay date30 days

Does AGX pay a reliable dividends?

See AGX dividend history and benchmarks