ROCKVILLE, MD— Argan , Inc. (NYSE:AGX), a company specializing in construction special trade contracting, announced Wednesday that its wholly owned subsidiary, Gemma Power Systems, has secured a subcontract to install five 90 MW gas turbines at a liquefied natural gas (LNG) facility in Louisiana. This development represents a significant step for Argan's operations in the energy infrastructure sector.
The formal notice to proceed with the project was received on Tuesday, according to a filing with the Securities and Exchange Commission (SEC). The installation of these turbines is a crucial component for the dedicated supply of power to the LNG facility, underlining the importance of Argan's role in the expansion and modernization of energy infrastructure.
Argan, Inc., headquartered at One Church Street, Rockville, Maryland, is incorporated in Delaware and has a longstanding presence in the construction and engineering industry. Formerly known as Puroflow Inc. and Ultra Dynamics Corp., the company has evolved over the years, adapting to the changing demands of the construction and energy sectors.
The company's stock, listed on the New York Stock Exchange under the ticker AGX, may see investor interest as market participants often look to such project announcements as indicators of a company's growth trajectory and future revenue streams.
This announcement comes directly from an 8-K filing with the SEC, providing investors with up-to-date information on the company's activities and contractual agreements. The details of the contract, including financial terms and project timelines, were not disclosed in the press release statement.
As Argan, Inc. advances its position in the industry with this new project, stakeholders and industry observers will be watching closely to see how this impacts the company's performance and the broader energy sector. This SEC filing ensures transparency and provides the public with verified information about Argan's business developments.
"In other recent news, Argan, Inc. reported a robust start to fiscal year 2025, marked by a significant 52% increase in consolidated revenues to $157.7 million, and an EBITDA of $11.9 million. The company's first-quarter project backlog reached an impressive $824 million, including a significant $300 million in renewable energy projects.
Gross profit for the quarter was $17.9 million, reflecting a gross profit percentage of 11.4%. The company also saw a substantial increase in net income to $7.9 million, up from the previous year's $2.1 million.
In addition, Argan has received a Letter of Intent for the installation of five 90 MW gas turbines from an LNG project, with potential revenue estimated between $50 million and $75 million. The company has also received a limited notice to proceed on a significant solar project in Illinois, which includes a 405 MW solar farm paired with 22 MW of battery storage. These developments highlight Argan's strategic positioning in the energy infrastructure market.
Lake Street Capital Markets raised the price target for Argan shares to $85.00 from the previous $70.00, maintaining a Buy rating on the stock. The firm anticipates Argan to experience a rise in activity over the next 12 to 24 months, with a steady flow of new project awards expected. These are recent developments that underline Argan, Inc.'s strong financial health and strategic positioning in the energy infrastructure market."
InvestingPro Insights
With Argan, Inc. (NYSE:AGX) announcing a significant subcontract in the energy infrastructure sector, investors may be considering the company's financial health and growth prospects. According to InvestingPro data, Argan's market capitalization stands at 1020M USD, with a P/E ratio of 26.84, reflecting investor expectations of future earnings.
Notably, the company has experienced a robust revenue growth of 36.84% over the last twelve months as of Q1 2023, which might be indicative of its capacity to handle large-scale projects like the one in Louisiana.
One of the InvestingPro Tips points out that analysts are anticipating sales growth in the current year, which aligns with the company's current trajectory. Additionally, the same source highlights that Argan has maintained dividend payments for 14 consecutive years, with a dividend yield of 1.57% as of the last dividend date, signaling potential reliability for income-focused investors.
For those considering deeper analysis, InvestingPro offers additional tips to gauge Argan's investment potential. With a total of 16 tips available, these insights could provide valuable context for the company's recent contract win. Interested readers can unlock these insights and more with an exclusive offer: use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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