Core Viewpoint - Graham Corporation reported its financial results for the third quarter of fiscal year 2026, highlighting its position as a leader in critical technologies for various industries [1]. Financial Performance - The company’s financial results for the third quarter indicate significant performance metrics, although specific figures were not detailed in the provided text [1]. - The fiscal year ending March 31, 2026, is emphasized as a key period for the company [1]. Leadership Commentary - Matthew J. Malone, President and CEO of Graham Corporation, provided insights on the third quarter results, indicating a positive outlook for the company [1].

Group 1 - Graham Corporation (NYSE:GHM) is recognized as one of the 12 Best HVAC Stocks to Buy Now [1] - Northland downgraded Graham Corporation to Market Perform from Outperform and raised its price target to $80 from $71, indicating the stock is nearing full value [2] - The company announced the acquisition of FlackTek Manufacturing, LLC and FlackTek Sales, LLC for $35 million, with 85% paid in cash and 15% in equity [3] Group 2 - The acquisition of FlackTek is expected to enhance Graham's capabilities in addressing complex customer needs across various sectors [4] - Graham Corporation specializes in mission-critical fluid, power, heat transfer, and vacuum technologies, serving industries such as Defense, Energy & Process, and Space [5] - The deal includes potential performance-based cash earnouts of up to $25 million over four years, tied to adjusted EBITDA targets [3]

Company Overview - Graham (GHM) is expected to report earnings for the quarter ended December 2025, with a consensus estimate of $0.17 per share, reflecting a year-over-year decline of 5.6% [3] - Revenues are anticipated to be $51.37 million, which represents a 9.2% increase from the previous year [3] Earnings Expectations - The earnings report is scheduled for release on February 6, and the stock price may rise if actual results exceed expectations, while a miss could lead to a decline [2] - The consensus EPS estimate has been revised down by 2.95% over the last 30 days, indicating a bearish sentiment among analysts [4] Earnings Surprise Prediction - The Zacks Earnings ESP (Expected Surprise Prediction) model indicates that Graham has an Earnings ESP of -88.46%, suggesting analysts have become more pessimistic about the company's earnings prospects [12] - The stock currently holds a Zacks Rank of 3, making it challenging to predict an earnings beat conclusively [12] Historical Performance - In the last reported quarter, Graham was expected to post earnings of $0.33 per share but delivered $0.31, resulting in a surprise of -6.06% [13] - Over the past four quarters, Graham has beaten consensus EPS estimates three times [14] Industry Comparison - RBC Bearings (RBC), a peer in the Zacks Manufacturing - General Industrial industry, is expected to report earnings of $2.85 per share, reflecting a year-over-year increase of 21.8% [18] - RBC's revenues are projected to be $461.12 million, up 16.9% from the previous year, with a consensus EPS estimate revised 0.9% higher in the last 30 days [19]

Group 1 - Northland downgraded Graham (GHM) to Market Perform from Outperform with a price target of $80, increased from $71 [1] - The firm is positive on the acquisition of FlackTek, a producer of proprietary material processing solutions [1] - Management signaled that orders are expected to decelerate to about $50 million in the second half of 2026, down from $209 million in the first half [1] - Analysts believe "a better entry could emerge" for investors [1]

Core Insights - Graco Inc. reported quarterly earnings of $0.77 per share, matching the Zacks Consensus Estimate, and showing an increase from $0.64 per share a year ago, with an earnings surprise of -0.52% [1] - The company achieved revenues of $593.2 million for the quarter ended December 2025, exceeding the Zacks Consensus Estimate by 1.39%, and up from $548.67 million year-over-year [2] - Graco's stock has increased by approximately 5.6% since the beginning of the year, outperforming the S&P 500's gain of 1% [3] Earnings Outlook - The future performance of Graco's stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.73 on revenues of $545.65 million, and for the current fiscal year, it is $3.17 on revenues of $2.32 billion [7] Industry Context - The Manufacturing - General Industrial industry, to which Graco belongs, is currently ranked in the top 40% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - The correlation between near-term stock movements and earnings estimate revisions suggests that tracking these revisions can provide insights into stock performance [5]

Company Overview - Graham (GHM) shares increased by 7.3% to close at $69.5, with a notable trading volume indicating strong investor interest [1] - The stock has experienced a 16.9% gain over the past four weeks, reflecting positive market sentiment [1] Market Drivers - The rally in Graham's stock is primarily attributed to optimism regarding its performance in defense, energy, and process markets, bolstered by a robust U.S. defense budget and increased sales in China [1] - The upcoming quarterly earnings report is expected to show earnings of $0.25 per share, representing a year-over-year increase of 38.9%, with revenues projected at $51.06 million, up 8.6% from the previous year [2] Earnings Estimates and Trends - The consensus EPS estimate for Graham has remained unchanged over the last 30 days, indicating stability in earnings expectations [3] - Historical data suggests that stock prices typically do not continue to rise without trends in earnings estimate revisions, highlighting the importance of monitoring future earnings updates for Graham [3] Industry Context - Graham operates within the Zacks Manufacturing - General Industrial industry, where Generac Holdings (GNRC) is another key player, currently holding a Zacks Rank of 4 (Sell) with an unchanged EPS estimate of $1.82, reflecting a year-over-year decline of 35% [3][4]

Core Insights - Graham Corporation (GHM) has experienced significant price appreciation, with an increase of nearly 40% year-to-date and 6.71% over the last month, driven by enhanced profitability, strong order flow, and improved guidance over the past 11 months [1] Financial Performance - The company's profitability has shown a notable increase, contributing to the overall positive market performance [1] - Strong orders have been a key factor in the company's growth trajectory, indicating robust demand for its products [1] Market Outlook - The guidance provided by the company has been upgraded, reflecting confidence in future performance and growth potential [1] - The overall market sentiment towards GHM appears to be positive, supported by the recent financial metrics and operational improvements [1]

Company Overview - Graham Corporation (GHM) is a small-cap industrial machinery stock with a market capitalization of approximately $700 million, recognized for its expertise in producing essential equipment and technologies for the Defense, Energy, and Space Industries [1]

Core Insights - Graham Corporation reported Q3 CY2025 revenue of $66.03 million, exceeding analyst expectations of $57.55 million, representing a year-on-year growth of 23.3% [1][6] - The company’s GAAP profit per share was $0.31, surpassing the consensus estimate of $0.28 by 10.7% [1][6] - Full-year revenue guidance is reaffirmed at approximately $230 million, aligning with analyst estimates [1][6] Revenue and Financial Performance - Revenue for Q3 was $66.03 million, a 23.3% increase year-on-year, and 14.7% above analyst estimates [6] - GAAP EPS was $0.31, exceeding analyst expectations by 10.7% [6] - Adjusted EBITDA was reported at $6.30 million, with a margin of 9.5%, also above analyst estimates [6] - Operating margin remained stable at 6.5%, consistent with the same quarter last year [6] - Backlog at the end of the quarter stood at $500.1 million [6] - Market capitalization is reported at $684.5 million [6] Strategic Outlook - Management highlighted strong revenue growth driven by defense programs, commercial space applications, and steady performance in energy and process markets [3][5] - Investments in advanced manufacturing and inspection capabilities, along with a new facility in Batavia, New York, are expected to enhance operational execution [3][4] - The company anticipates continued growth due to a record backlog and ongoing capacity investments, particularly in defense and space markets [4] - Capital allocation remains disciplined, with expected returns over 20% on investments in new test facilities and advanced technologies [4] - Strategic acquisition of Xdot Bearing Technologies and projects in small modular nuclear reactors are seen as key to long-term visibility and growth [4]

Core Insights - Graham Corporation reported strong performance in the second quarter of fiscal 2026, with a record backlog of $500.1 million and healthy demand across its end markets, particularly in Defense and Space sectors [3][5][16]. Financial Performance - Net sales increased by 23% to $66.0 million compared to $53.6 million in the same quarter last year [5][7]. - Gross profit rose by 12% to $14.3 million, with a gross profit margin of 21.7%, down 220 basis points from the previous year [5][8]. - Net income per diluted share was $0.28, while adjusted net income per diluted share was $0.31, reflecting no change from the prior year [5][39]. - Adjusted EBITDA increased by 12% to $6.3 million, with an adjusted EBITDA margin of 9.5% [5][39]. Orders and Backlog - Orders for the quarter totaled $83.2 million, resulting in a book-to-bill ratio of 1.3x [5][14]. - The backlog at the end of the quarter was a record $500.1 million, a 23% increase year-over-year, with approximately 85% of the backlog attributed to the Defense industry [5][16]. Market Segments - Sales in the Defense market contributed $9.9 million to growth, driven by project milestones and new programs [7]. - The Energy & Process market saw an 11% increase in sales, primarily due to growth in China, although sales in India decreased due to project timing [7]. Cash Management and Balance Sheet - The company maintained a strong balance sheet with no debt, $20.6 million in cash, and access to $44.7 million under its revolving credit facility [5][11]. - Cash provided by operating activities for the quarter was $13.6 million [10]. Strategic Outlook - The company is focused on high-return initiatives to enhance productivity and profitability, including investments in automation and advanced testing technologies [3][5]. - Full-year fiscal 2026 guidance remains unchanged, with expectations for revenue between $225 million and $235 million and adjusted EBITDA between $22 million and $28 million [19][21].