Powell Industries, Inc. (POWL) Hits Fresh High: Is There Still Room to Run?

Core Viewpoint - Powell Industries (POWL) has experienced significant stock performance, with a 19.3% increase over the past month and a 147% rise since the beginning of the year, outperforming the Zacks Industrial Products sector and the Zacks Manufacturing - Electronics industry [1] Financial Performance - In the last earnings report on July 30, 2024, Powell Industries reported an EPS of $3.79, exceeding the consensus estimate of $2.12, marking a strong record of positive earnings surprises [2] - For the current fiscal year, Powell Industries is projected to achieve earnings of $12.01 per share on revenues of $1.01 billion, reflecting a 191.5% increase in EPS and a 45% increase in revenues [3] - The next fiscal year is expected to see earnings of $12.44 per share on revenues of $1.05 billion, indicating a year-over-year change of 3.58% in EPS and 4% in revenues [3] Valuation Metrics - Powell Industries currently trades at 18.2X current fiscal year EPS estimates, below the peer industry average of 22.7X, and at 44.2X trailing cash flow compared to the peer group's average of 22X [7] - The stock has a PEG ratio of 1.3, which does not place it among the top echelon of stocks from a value perspective [7] Zacks Rank and Style Scores - Powell Industries holds a Zacks Rank of 1 (Strong Buy) due to rising earnings estimates, meeting the criteria for investors seeking stocks with strong potential [8] - The company has a Value Score of C, a Growth Score of B, and a Momentum Score of F, resulting in a combined VGM Score of B [6] Industry Comparison - Enersys (ENS), a peer in the industry, has a Zacks Rank of 2 (Buy) and shows strong earnings performance, with expected earnings of $8.94 per share on revenues of $3.75 billion for the current fiscal year [9][10] - The Manufacturing - Electronics industry is positioned in the top 9% of all industries, suggesting favorable conditions for both Powell Industries and Enersys [11]