Powell(US:POWL) The Motley Foolยท2025-08-06 18:12Core Viewpoint - Powell Industries reported fiscal third-quarter earnings that missed revenue expectations but exceeded profit expectations, indicating a more favorable underlying trajectory than initially perceived [1][3]. Revenue Performance - The company's fiscal third quarter experienced a slight 1% decline in revenue compared to expectations, but showed a 3% increase relative to the prior quarter [3]. - The electric utility segment saw a significant increase of 31%, while commercial and light industrial revenue rose by 18% [4]. - In contrast, the oil and gas segment declined by 8%, and the petrochemical segment saw a substantial decline of 36% [5]. Earnings and Margins - Earnings per share reached $3.96, reflecting a 4% increase and beating expectations, supported by an encouraging expansion in gross margins [3]. Booking Trends - Overall booking trends appeared positive, with bookings growing by 45% quarter over quarter, leading to a 7% sequential growth in backlog [5]. Future Growth Potential - Powell Industries trades at a 16.7 multiple based on 2025 estimates, which may seem low for a company with modest growth; however, as the electric utility segment constitutes a larger portion of the business, there is potential for upside surprises [7]. - The electric utility segment accounted for 26% of revenue in the June quarter, while commercial and industrial segments made up another 17% [7]. - Continued growth in these segments could position them as major drivers of the business in the future [8].