Track market-moving stories before they get noisy

Powell Industries (POWL - Free Report) ended the recent trading session at $240.68, demonstrating a -1.52% change from the preceding day's closing price. The stock trailed the S&P 500, which registered a daily loss of 0.14%. Elsewhere, the Dow lost 0.01%, while the tech-heavy Nasdaq lost 0.57%.

Heading into today, shares of the energy equipment company had lost 16.16% over the past month, lagging the Industrial Products sector's loss of 3.37% and the S&P 500's gain of 0.25%.

Market participants will be closely following the financial results of Powell Industries in its upcoming release. The company plans to announce its earnings on August 3, 2026. The company is predicted to post an EPS of $1.49, indicating a 12.88% growth compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $318.25 million, indicating a 11.17% growth compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $5.47 per share and revenue of $1.2 billion. These totals would mark changes of +10.51% and +8.73%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Powell Industries. These latest adjustments often mirror the shifting dynamics of short-term business patterns. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. As of now, Powell Industries holds a Zacks Rank of #3 (Hold).

Looking at valuation, Powell Industries is presently trading at a Forward P/E ratio of 44.68. This valuation marks a premium compared to its industry average Forward P/E of 22.68.

It is also worth noting that POWL currently has a PEG ratio of 3.19. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Manufacturing - Electronics was holding an average PEG ratio of 1.61 at yesterday's closing price.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 105, which puts it in the top 43% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.

Powell Industries (POWL - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.

Shares of this energy equipment company have returned -16.2% over the past month versus the Zacks S&P 500 composite's +0.3% change. The Zacks Manufacturing - Electronics industry, to which Powell Industries belongs, has lost 5.9% over this period. Now the key question is: Where could the stock be headed in the near term?

Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.

Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

Powell Industries is expected to post earnings of $1.49 per share for the current quarter, representing a year-over-year change of +12.9%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

For the current fiscal year, the consensus earnings estimate of $5.47 points to a change of +10.5% from the prior year. Over the last 30 days, this estimate has remained unchanged.

For the next fiscal year, the consensus earnings estimate of $6.66 indicates a change of +21.7% from what Powell Industries is expected to report a year ago. Over the past month, the estimate has changed -2.7%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Powell Industries.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

In the case of Powell Industries, the consensus sales estimate of $318.25 million for the current quarter points to a year-over-year change of +11.2%. The $1.2 billion and $1.46 billion estimates for the current and next fiscal years indicate changes of +8.7% and +21.3%, respectively.

Last Reported Results and Surprise HistoryPowell Industries reported revenues of $296.61 million in the last reported quarter, representing a year-over-year change of +6.5%. EPS of $1.25 for the same period compares with $1.27 a year ago.

Compared to the Zacks Consensus Estimate of $298.22 million, the reported revenues represent a surprise of -0.54%. The EPS surprise was -6.72%.

Over the last four quarters, Powell Industries surpassed consensus EPS estimates three times. The company topped consensus revenue estimates just once over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Powell Industries is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Powell Industries. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

Posted by Defense World Staff on Jul 20th, 2026

Bessemer Group Inc. raised its holdings in shares of Powell Industries, Inc. (NASDAQ:POWL – Free Report) by 15,570.8% in the first quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The fund owned 11,283 shares of the industrial products company’s stock after buying an additional 11,211 shares during the quarter. Bessemer Group Inc.’s holdings in Powell Industries were worth $6,105,000 as of its most recent SEC filing.

Several other hedge funds also recently modified their holdings of the business. Greenline Wealth Management LLC bought a new position in Powell Industries during the fourth quarter worth $29,000. Avanza Fonder AB bought a new stake in Powell Industries in the 4th quarter valued at $30,000. Steward Partners Investment Advisory LLC grew its position in Powell Industries by 126.0% in the 4th quarter. Steward Partners Investment Advisory LLC now owns 113 shares of the industrial products company’s stock worth $36,000 after purchasing an additional 63 shares during the last quarter. First Horizon Corp acquired a new stake in Powell Industries in the 4th quarter worth $40,000. Finally, Larson Financial Group LLC increased its holdings in shares of Powell Industries by 12,800.0% during the 4th quarter. Larson Financial Group LLC now owns 129 shares of the industrial products company’s stock worth $41,000 after purchasing an additional 128 shares during the period. 89.77% of the stock is owned by institutional investors.

Powell Industries Stock Performance Shares of POWL stock opened at $232.79 on Monday. The firm has a fifty day moving average of $277.14 and a 200-day moving average of $216.73. The stock has a market cap of $8.48 billion, a price-to-earnings ratio of 45.56, a P/E/G ratio of 3.04 and a beta of 1.13. Powell Industries, Inc. has a 52-week low of $69.00 and a 52-week high of $328.00.

Powell Industries (NASDAQ:POWL – Get Free Report) last issued its earnings results on Monday, May 4th. The industrial products company reported $1.25 earnings per share for the quarter, missing the consensus estimate of $1.34 by ($0.09). The business had revenue of $296.62 million for the quarter, compared to analyst estimates of $298.12 million. Powell Industries had a net margin of 16.51% and a return on equity of 28.61%. Powell Industries’s revenue was up 6.5% on a year-over-year basis. During the same quarter last year, the firm posted $3.81 earnings per share. On average, sell-side analysts predict that Powell Industries, Inc. will post 5.47 earnings per share for the current year.

Powell Industries Cuts Dividend The business also recently disclosed a quarterly dividend, which was paid on Wednesday, June 17th. Shareholders of record on Wednesday, May 20th were issued a dividend of $0.09 per share. This represents a $0.36 dividend on an annualized basis and a yield of 0.2%. The ex-dividend date of this dividend was Wednesday, May 20th. Powell Industries’s payout ratio is presently 7.05%.

Insider Activity at Powell Industries In related news, major shareholder Thomas W. Powell sold 33,958 shares of the firm’s stock in a transaction that occurred on Thursday, June 25th. The stock was sold at an average price of $294.49, for a total transaction of $10,000,291.42. Following the completion of the transaction, the insider owned 564,736 shares in the company, valued at $166,309,104.64. This trade represents a 5.67% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. Also, EVP Michael William Metcalf sold 4,500 shares of the firm’s stock in a transaction that occurred on Tuesday, June 30th. The stock was sold at an average price of $284.64, for a total value of $1,280,880.00. Following the transaction, the executive vice president owned 78,900 shares of the company’s stock, valued at $22,458,096. This trade represents a 5.40% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last ninety days, insiders sold 55,088 shares of company stock valued at $16,070,066. Corporate insiders own 2.20% of the company’s stock.

Wall Street Analysts Forecast Growth A number of research analysts have recently commented on the stock. Cantor Fitzgerald upped their price objective on shares of Powell Industries from $160.00 to $320.00 and gave the company a “neutral” rating in a research report on Monday, May 11th. Zacks Research lowered Powell Industries from a “strong-buy” rating to a “hold” rating in a research note on Monday, May 11th. Weiss Ratings cut Powell Industries from a “buy (b)” rating to a “buy (b-)” rating in a report on Thursday. Texas Capital upgraded Powell Industries to a “strong-buy” rating in a research report on Friday, March 27th. Finally, JPMorgan Chase & Co. lifted their price objective on Powell Industries from $310.00 to $360.00 and gave the stock an “overweight” rating in a report on Wednesday, May 6th. Two research analysts have rated the stock with a Strong Buy rating, three have given a Buy rating and two have given a Hold rating to the company’s stock. Based on data from MarketBeat, Powell Industries has an average rating of “Buy” and an average price target of $236.67.

Check Out Our Latest Stock Analysis on POWL

Powell Industries Profile (Free Report)

Powell Industries, Inc is an industrial electrical engineering company specializing in the design, manufacture and integration of customized power control and distribution solutions. The firm’s offerings range from medium‐voltage switchgear and power control centers to bus duct, motor control centers and specialty transformers. Powell also provides automation systems, protective relaying, metering, supervisory control and data acquisition (SCADA) platforms, and turnkey engineering services to help clients manage critical power infrastructure.

Serving the oil and gas, petrochemical, refining, utility, mining and industrial sectors, Powell’s products are engineered to meet demanding performance, safety and reliability requirements.

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The most durable growth stories for companies usually share two traits: a powerful tailwind pushing demand higher, and a balance sheet strong enough to fund expansion without leaning on debt or diluting shareholders. The five industrial companies featured below have both.

Each of these companies is riding the enormous build-out of artificial intelligence (AI) data centers and the electrification of the power grid, and each carries plenty of cash and little debt, suggesting their best growth may still be ahead.

Let's take a closer look at these five industrial stocks and see if there is investment potential in any of them.

Image source: Getty Images.

1. GE Vernova GE Vernova (GEV +2.17%) makes the gas turbines, grid equipment, and electrification gear the world needs to power AI. Its financial footing is enviable, with a cash balance above $10 billion and minimal debt, and free cash flow recently quadrupled from the prior year. Backlog has swelled past $160 billion, and its electrification segment booked more data center equipment orders in a single quarter than in all of the prior year. That cash cushion lets it invest, buy back stock, and pay a dividend all at once.

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2. Vertiv Holdings Vertiv Holdings (VRT 1.80%) builds the power and cooling systems that keep dense AI server racks from overheating, making it a direct beneficiary of every new data center. Its backlog has ballooned to around $15 billion, and it generates strong free cash flow while carrying modest leverage of roughly half its annual earnings. It recently refinanced into investment-grade bonds, which lowers its borrowing costs and stretches out maturities. In short, it is funding a boom largely from its own cash.

3. Comfort Systems USA Comfort Systems USA (FIX 0.71%) handles the mechanical and electrical work, especially heating and cooling, that data centers and factories cannot open without. Roughly half of its revenue now comes from technology and data center projects, its backlog has climbed toward record levels, and the business generates more than a billion dollars in operating cash flow a year. With a lightly leveraged balance sheet, Comfort Systems can continue to acquire smaller firms and expand capacity as demand outpaces supply.

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4. Sterling Infrastructure Sterling Infrastructure (STRL 0.51%) prepares the ground for data centers and semiconductor plants, doing the site development that comes before the concrete. It holds more cash than debt, a net cash position that gives it real flexibility, and its combined backlog has jumped well over 100% as mission-critical projects pile up, including a major semiconductor campus. A clean balance sheet is exactly what you want in a company scaling this fast.

5. Powell Industries Powell Industries (POWL 1.27%) is the smallest name here and arguably the most pristine financially. The provider of electrical equipment and services carries hundreds of millions in cash and short-term investments with no drawn debt at all, a genuine fortress balance sheet. New orders recently surged nearly 100%, backlog hit a record, and it landed the largest data center order in its history, worth more than $400 million. For a company its size, that is a step-change in demand.

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Quality ways to play a durable trend A word of caution before you get too excited. All five of these companies are tied to the same theme, the AI and electrification build-out, which means a slowdown in data center spending would hit them all together. Their stocks have also run up over the last couple of years as investors have caught on, so valuations are no longer cheap, and industrials are cyclical by nature. Strong balance sheets reduce the risk of a stumble becoming a disaster, but they do not make the stocks immune to a downturn.

What ties these five together is financial strength meeting a long runway. I love low-debt companies. GE Vernova, Vertiv, Comfort Systems, Sterling Infrastructure, and Powell Industries all have the cash to invest and the balance sheets to weather bumps while demand for power and data center infrastructure keeps climbing. I would treat them as quality ways to play a durable trend, mindful that the valuations demand patience and the cycle will not rise forever.

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Stock Market Jumps As Inflation Eases; IBM Warns, But Chip, Security Software Names Fly Powell Industries and Nextpower — industrial power players turned data center stocks — climbed Wednesday after analysts elevated their ratings and as AI-driven demand gobbles up the narrative. GLJ Research upgraded industrial power systems maker Powell Industries (POWL) to a buy rating. The stock rallied more than 3.5%. Nextpower (NXT), which provides utility-scale solar infrastructure, swung nearly 5% higher. It…

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The iShares Morningstar Small-Cap Growth ETF (ISCG 0.69%) provides a low-cost, highly diversified approach to small-cap growth, while the Invesco S&P SmallCap 600 Pure Growth ETF (RZG 0.86%) offers a more concentrated strategy.

Both funds target the small-cap growth segment but build their portfolios in different ways. ISCG follows a traditional market-cap-weighted index of small companies, while RZG screens the S&P SmallCap 600 for stocks with the strongest growth characteristics -- such as sales growth, earnings momentum, and price momentum -- and weights its holdings accordingly.

Snapshot (cost & size)MetricRZGISCGIssuerInvescoiSharesExpense ratio0.35%0.06%1-year return (as of July 9, 2026)38.84%27.53%Dividend yield0.42%0.57%Beta1.041.22AUM$135.9 million$1.0 billionBeta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-year return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.

ISCG is significantly cheaper, with an expense ratio of 0.06%, compared to RZG’s 0.35%. ISCG also offers a slightly higher dividend yield of 0.57%, compared to RZG's 0.42% -- a modest edge for income-minded investors.

Performance & risk comparisonMetricRZGISCGMax drawdown (5 yr)(38.33%)(41.47%)Growth of $1,000 over 5 years (total return)$1,375$1,298What's insideLaunched in 2004, ISCG tracks a broad index of small-cap growth stocks. The fund has heavy concentrations in industrials and technology at 23.9% and 22.5%, respectively, as well as healthcare at 17.9%. With 933 holdings, it offers extensive diversification, minimizing individual stock risk. Its largest positions include Sterling Infrastructure (STRL 3.47%) at 0.8%, Okta (OKTA 6.89%) at 0.7%, and Guardant Health (GH 2.46%) at 0.6%.

RZG provides a narrower portfolio of 125 stocks, built from the S&P SmallCap 600 index. This index uses a growth-score methodology that favors companies with strong sales growth, earnings momentum, and price momentum. Its top sector allocations are healthcare at 25.1%, technology at 17.3%, and industrials at 16.4%. RZG’s approach leads to higher concentration than ISCG's, with top holdings including ACM Research (ACMR 2.87%) at 3.7%, Powell Industries (POWL 1.80%) at 2.0%, and Argan (AGX 8.32%) at 2.0%. RZG fund was launched in 2006.

For more guidance on ETF investing, check out the full guide at this link.

What this means for investorsThe choice between these two funds really comes down to how much an investor is willing to pay for the potential to outperform.

Cost is almost always a primary consideration when two funds target a similar corner of the market. ISCG's 0.06% expense ratio is about as cheap as small-cap investing gets -- on a $10,000 investment, ISCG charges roughly $6 a year, versus about $35 a year for RZG. Over long holding periods, that fee gap can compound meaningfully.

That said, RZG's recent outperformance isn't surprising given the type of stocks it holds. By concentrating on companies already showing strong sales and earnings momentum, growth-oriented funds like RZG tend to do well when those trends stay intact -- but that same concentration can cut both ways if momentum fades or a handful of its largest holdings stumble. ISCG's broader, market-cap-weighted approach spreads that risk across more than 900 companies, trading some upside potential for more diversified exposure to the small-cap growth space.

Investors who want the cheapest, most diversified way to own small-cap growth stocks may lean toward ISCG, while those comfortable with more concentrated bets on recent momentum, and willing to pay more for it, may find RZG's recent track record more appealing. As with any small-cap allocation, these funds are probably best used as a slice of a diversified portfolio rather than a core holding, given the added volatility that comes with smaller companies.

Powell Industries (POWL - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.

Over the past month, shares of this energy equipment company have returned -13.5%, compared to the Zacks S&P 500 composite's -0.9% change. During this period, the Zacks Manufacturing - Electronics industry, which Powell Industries falls in, has lost 4.1%. The key question now is: What could be the stock's future direction?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

Powell Industries is expected to post earnings of $1.49 per share for the current quarter, representing a year-over-year change of +12.9%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

The consensus earnings estimate of $5.47 for the current fiscal year indicates a year-over-year change of +10.5%. This estimate has remained unchanged over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $6.84 indicates a change of +25.1% from what Powell Industries is expected to report a year ago. Over the past month, the estimate has remained unchanged.

Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Powell Industries is rated Zacks Rank #3 (Hold).

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

For Powell Industries, the consensus sales estimate for the current quarter of $318.25 million indicates a year-over-year change of +11.2%. For the current and next fiscal years, $1.2 billion and $1.46 billion estimates indicate +8.7% and +21.3% changes, respectively.

Last Reported Results and Surprise HistoryPowell Industries reported revenues of $296.61 million in the last reported quarter, representing a year-over-year change of +6.5%. EPS of $1.25 for the same period compares with $1.27 a year ago.

Compared to the Zacks Consensus Estimate of $298.22 million, the reported revenues represent a surprise of -0.54%. The EPS surprise was -6.72%.

Over the last four quarters, Powell Industries surpassed consensus EPS estimates three times. The company topped consensus revenue estimates just once over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Powell Industries is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Powell Industries. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

Powell Industries (POWL - Free Report) closed at $286.36 in the latest trading session, marking a +1.87% move from the prior day. The stock outperformed the S&P 500, which registered a daily gain of 0.79%. Meanwhile, the Dow gained 0.26%, and the Nasdaq, a tech-heavy index, added 1.52%.

Heading into today, shares of the energy equipment company had lost 2.44% over the past month, lagging the Industrial Products sector's gain of 8.84% and the S&P 500's loss of 1.82%.

Market participants will be closely following the financial results of Powell Industries in its upcoming release. The company's upcoming EPS is projected at $1.49, signifying a 12.88% increase compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $318.25 million, indicating a 11.17% upward movement from the same quarter last year.

For the full year, the Zacks Consensus Estimates project earnings of $5.47 per share and a revenue of $1.2 billion, demonstrating changes of +10.51% and +8.73%, respectively, from the preceding year.

Investors should also pay attention to any latest changes in analyst estimates for Powell Industries. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Powell Industries currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, Powell Industries is holding a Forward P/E ratio of 51.39. This valuation marks a premium compared to its industry average Forward P/E of 23.02.

We can additionally observe that POWL currently boasts a PEG ratio of 3.67. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Manufacturing - Electronics stocks are, on average, holding a PEG ratio of 1.8 based on yesterday's closing prices.

The Manufacturing - Electronics industry is part of the Industrial Products sector. With its current Zacks Industry Rank of 82, this industry ranks in the top 34% of all industries, numbering over 250.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?

Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about Powell Industries (POWL - Free Report) .

Powell Industries currently has an average brokerage recommendation (ABR) of 2.00, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by six brokerage firms. An ABR of 2.00 indicates Buy.

Of the six recommendations that derive the current ABR, three are Strong Buy, representing 50% of all recommendations.

Brokerage Recommendation Trends for POWL

Check price target & stock forecast for Powell Industries here>>>

The ABR suggests buying Powell Industries, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.

Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.

This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.

With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.

Zacks Rank Should Not Be Confused With ABRAlthough both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.

The ABR is calculated solely based on brokerage recommendations and is typically displayed with decimals (example: 1.28). In contrast, the Zacks Rank is a quantitative model allowing investors to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.

It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.

In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.

Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.

Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.

Should You Invest in POWL?Looking at the earnings estimate revisions for Powell Industries, the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $5.47.

Analysts' steady views regarding the company's earnings prospects, as indicated by an unchanged consensus estimate, could be a legitimate reason for the stock to perform in line with the broader market in the near term.

The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Powell Industries. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

It may therefore be prudent to be a little cautious with the Buy-equivalent ABR for Powell Industries.

Powell Industries (POWL - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.

Over the past month, shares of this energy equipment company have returned +10.2%, compared to the Zacks S&P 500 composite's +0.1% change. During this period, the Zacks Manufacturing - Electronics industry, which Powell Industries falls in, has gained 10.3%. The key question now is: What could be the stock's future direction?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

Powell Industries is expected to post earnings of $1.49 per share for the current quarter, representing a year-over-year change of +12.9%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

For the current fiscal year, the consensus earnings estimate of $5.47 points to a change of +10.5% from the prior year. Over the last 30 days, this estimate has remained unchanged.

For the next fiscal year, the consensus earnings estimate of $6.84 indicates a change of +25.1% from what Powell Industries is expected to report a year ago. Over the past month, the estimate has remained unchanged.

Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Powell Industries is rated Zacks Rank #3 (Hold).

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.

For Powell Industries, the consensus sales estimate for the current quarter of $318.25 million indicates a year-over-year change of +11.2%. For the current and next fiscal years, $1.2 billion and $1.46 billion estimates indicate +8.7% and +21.3% changes, respectively.

Last Reported Results and Surprise HistoryPowell Industries reported revenues of $296.61 million in the last reported quarter, representing a year-over-year change of +6.5%. EPS of $1.25 for the same period compares with $1.27 a year ago.

Compared to the Zacks Consensus Estimate of $298.22 million, the reported revenues represent a surprise of -0.54%. The EPS surprise was -6.72%.

Over the last four quarters, Powell Industries surpassed consensus EPS estimates three times. The company topped consensus revenue estimates just once over this period.

ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Powell Industries is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Powell Industries. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

Powell Industries (POWL - Free Report) closed at $292.70 in the latest trading session, marking a -3.57% move from the prior day. The stock fell short of the S&P 500, which registered a loss of 0.57% for the day. On the other hand, the Dow registered a gain of 0.64%, and the technology-centric Nasdaq decreased by 1.15%.

Coming into today, shares of the energy equipment company had gained 13.77% in the past month. In that same time, the Industrial Products sector gained 4.73%, while the S&P 500 gained 2.14%.

Market participants will be closely following the financial results of Powell Industries in its upcoming release. The company's earnings per share (EPS) are projected to be $1.49, reflecting a 12.88% increase from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $318.25 million, indicating a 11.17% growth compared to the corresponding quarter of the prior year.

POWL's full-year Zacks Consensus Estimates are calling for earnings of $5.47 per share and revenue of $1.2 billion. These results would represent year-over-year changes of +10.51% and +8.73%, respectively.

It's also important for investors to be aware of any recent modifications to analyst estimates for Powell Industries. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Powell Industries presently features a Zacks Rank of #3 (Hold).

With respect to valuation, Powell Industries is currently being traded at a Forward P/E ratio of 55.49. For comparison, its industry has an average Forward P/E of 22.58, which means Powell Industries is trading at a premium to the group.

Investors should also note that POWL has a PEG ratio of 3.96 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Manufacturing - Electronics industry had an average PEG ratio of 1.76 as trading concluded yesterday.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 75, putting it in the top 31% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.

Powell Industries (POWL) has been one of the stocks most watched by Zacks.com users lately. So, it is worth exploring what lies ahead for the stock.

Shares of Powell Industries (POWL 7.63%) rallied on Tuesday, up as much as 15.6% on the day, before settling into an 11.1% gain by 1:47 p.m. EDT.

Powell produces a wide variety of power and electric generation and management systems for industrial sites, and has traditionally focused on the oil & gas and chemical markets. However, the AI data center build-out now requires sophisticated, high-power systems, which Powell specializes in.

The massive step-up in AI-related demand was evident in last night's earnings release and call, in which Powell disclosed that the company had received a "mega order" that was not only its largest in history, but also larger than last quarter's entire revenue by a fair amount.

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Massive new orders overshadow an earnings miss Powell's March quarter revenues and earnings missed analyst estimates, with revenue growing 6% to $297 million and earnings per share declining 1% to $1.25. However, since Powell provides large industrial projects, revenue recognition and profits can be lumpy from quarter to quarter.

The company's main segments did grow at a much stronger pace. The Commercial & Industrial segment, which serves AI data centers, was up 35%. The Electric Utility segment was up 14%, and even the traditional Oil & Gas segment was up 11%. However, counteracting these gains was a big decline in the Petrochemical segment, which fell 37%.

The big news, however, was that new order numbers overwhelmed the actual reported results. New orders in the quarter totaled $490 million, up a whopping 97% over the prior year quarter. Not only that, but management also disclosed that after the quarter's end in April, Powell received a single "mega order" for an AI data center project totaling $400 million.

That's an absolutely massive single order, dwarfing the company's entire March quarter revenue by 33%! Thus, it's no wonder that the stock surged higher after an initial decline on the headline results.

Image source: Getty Images.

Powell's high valuation looks justified At first glance, Powell may seem overvalued. The stock is up 181% year-to-date, and is trading at 58 times earnings, which seems high for an industrial stock. However, the company's huge order growth and the mega-deal on top of that mean there should be a lot of revenue and earnings growth "in the pipeline" for investors, so to speak.

It's hard to know how long this AI build-out will last, but if it goes beyond this year, Powell's high-flying stock price looks justified.

Applied Optoelectronics reported a healthy quarter and discussed winning major new orders from large hyperscale customers. Powell Industries secured several large data center wins, complementing a steady stream of utility-related awards in recent periods. Vital Farms faces a temporary supply glut in the egg market after last year's avian influenza outbreak quickly subsided.

Powell Industries, Inc. reported Q2 headline misses, but a surging backlog ($1.8B, +33% y/y) and new orders (+96% y/y) drive optimism. POWL secured a $400M data center megaproject, not yet in Q2 results, supporting robust multi-year growth visibility through at least fiscal year 2028. The book-to-bill ratio hit 1.7x, reflecting demand outpacing capacity; management is prudently expanding its footprint to avoid overbuilding and margin erosion.

Key Takeaways Powell saw strong Q2 revenue growth in commercial, industrial and electric utility markets.POWL benefited from energy transition projects and rising power generation investments.Backlog reached $1.8 billion as diversified orders drove strong sequential bookings growth. Powell Industries, Inc.’s (POWL - Free Report) diversification efforts beyond its core oil, gas and petrochemical markets have enhanced its market share across the electric utility, light rail traction power and commercial & other industrial markets. In second-quarter fiscal 2026 (ended March 2026), revenues from the commercial & other industrial sector and electric utility sector surged 35% and 14% year over year, respectively, while those from oil & gas increased 11%.

Several favorable trends across the oil and gas market, including growth in energy transition projects, have been proving beneficial for the company. Also, growing investments across power generation and electrical distribution markets have been driving demand for the company’s products. Its increased participation across the electrical power value chain has enabled it to generate solid bookings from the electric utility and commercial & other industrial markets.

This has led to impressive growth in the backlog level, which was $1.8 billion (up 12% sequentially) while exiting the fiscal second quarter. New orders totaled $490 million in the quarter, reflecting growth of 11.6% on a sequential basis. Importantly, the new orders consisted of awards across all key markets that reflected the company’s core competencies and well-balanced portfolio.

A strong pipeline of projects, particularly within the electric utility and commercial and other industrial markets, along with a solid backlog, is likely to support the company’s growth in the quarters ahead.

Segment Snapshot of POWL’s PeersEnerSys (ENS - Free Report) is witnessing strength in the Energy Systems segment, supported by the expansion of U.S. communications networks and AI-driven data demand. Revenues from EnerSys’ Energy Systems segment increased 2.6% to $399.5 million in third-quarter fiscal 2026 (ended Dec. 31, 2025). The global megatrends, including the expansion of 5G, rural broadband build-outs, the modernization of energy grids, electrification, automation and decarbonization, are likely to be favorable for EnerSys.

Eaton Corporation plc’s (ETN - Free Report) Electrical and Aerospace segment backlog growth remained strong as orders and the supply chain began to normalize gradually. Rising backlog and solid orders for its products will continue to drive the performance of the company in the long run. The transition in Utility space and Aerospace growth will also benefit Eaton, as its customized products will fulfill the needs of these sectors. Eaton’s backlog, at the end of first-quarter 2026, increased 44% in Electrical Americas, 26% in Aerospace and 73% in Electric Global on a rolling 12-month basis.

POWL’s Price Performance, Valuation and EstimatesShares of Powell Industries have surged 65.2% in the past three months compared with the industry’s growth of 1.3%.

Image Source: Zacks Investment Research

From a valuation standpoint, POWL is trading at a forward price-to-earnings ratio of 50.92X, below the industry’s average of 24.39X. Powell Industries carries a Value Score of F.

Image Source: Zacks Investment Research

On May 18, 2026, Powell Industries Inc POWL shares fell 8.8% today, bringing the current price to $266.80. This decline follows a one-week performance of -17.2%, amidst a 52-week range that saw a high of $328.00 and a low of $54.75.

GF Value™ verdict: The current price is $266.80, representing a 253.9% overvaluation against a GF Value™ of $75.38.GF Score™ of 75/100 indicates an above-average ranking, suggesting solid fundamentals.Notable signal: Insiders sold $32.9 million in shares over the last three months, with no insider buying reported. Is POWL Overvalued or Undervalued? Powell Industries Inc POWL is currently trading significantly above its GF Value™, which is calculated at $75.38. This suggests that the stock is overvalued by approximately 253.9%, indicating a considerable margin of safety for potential investors looking for undervalued opportunities. The GF Valuation label indicates that POWL is "Significantly Overvalued," which aligns with the current price being more than three times its estimated fair value.

The risk associated with investing in overvalued stocks is that they may face downward pressure as the market corrects itself, and investors may experience losses if they enter at such inflated prices. In contrast, if a stock were undervalued, it would present an attractive opportunity, albeit with caveats regarding the company's future performance and market conditions. GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates.

How Does POWL's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 52.2x 22.7x Forward P/E 48.5x N/A The current P/E ratio of 52.2x is 130% above its 5-year median P/E of 22.7x, which indicates that POWL is trading at a premium compared to its historical valuation. This P/E analysis reinforces the GF Value™ verdict, confirming that the stock is overvalued and may not be a wise investment choice at this time.

What Does POWL's GF Score™ Tell Us? The GF Score™ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have been found to generate higher long-term returns (backtested 2006-2021).

Metric Rating GF Score™ 75/100 Financial Strength 8/10 Profitability 7/10 Growth 10/10 Valuation 1/10 Momentum 3/10 The scores indicate that while POWL has strong Financial Strength (8/10) and exceptional Growth potential (10/10), it faces significant challenges in terms of Valuation (1/10) and Momentum (3/10). The above-average GF Score™ of 75 suggests that despite its overvaluation, POWL has robust fundamentals that may support its long-term performance, but investors should remain cautious about its current price levels.

What Are Insiders Doing with POWL Stock? In the past three months, insiders at Powell Industries Inc have sold a total of $32.9 million worth of shares, with no reported buying activity. This pattern of selling may suggest a lack of confidence among insiders regarding the stock's future price potential, which could serve as a cautionary signal for outside investors. Typically, insider selling can indicate that those closest to the company believe the stock is overvalued or that they are taking profits in anticipation of a price correction.

What This Means for Investors Based on the GF Value™ assessment, Powell Industries Inc POWL is currently overvalued. The significant disparity between the current stock price and the GF Value™ indicates a high potential risk for investors considering entering this market. Caution is advised, as the stock may not provide favorable returns in the near future.

For the complete analysis, visit the Powell Industries Inc POWL stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.

Frequently Asked Questions What is POWL's GF Score™?

POWL's GF Score™ is 75/100, which indicates above-average fundamentals and suggests potential for higher long-term returns.

Is POWL overvalued or undervalued?

POWL is significantly overvalued with a GF Value™ of $75.38 compared to the current price of $266.80, marking a 253.9% overvaluation.

What is POWL's P/E ratio?

POWL's P/E ratio is currently 52.2x, which is substantially above its 5-year median P/E of 22.7x, further supporting the conclusion that the stock is overvalued.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Key Takeaways Powell backlog reached $1.8 billion as utility and industrial demand fueled new orders.POWL secured major data center and electric utility awards, including a $400 million order.Electric utility and commercial industrial revenues rose sharply in fiscal Q2 2026. Powell Industries, Inc. (POWL - Free Report) is witnessing persistent strength and healthy levels of project activity across the electric utility and commercial & other industrial markets. Growing investments across power generation and electrical distribution markets have been driving demand for the company’s products in the electric utility market.

The company’s increased participation across the electrical power value chain has enabled it to generate solid bookings from the electric utility and commercial & other industrial markets. This has led to a strong backlog level, which was $1.8 billion (up 33% year over year and 12% sequentially) while exiting second-quarter fiscal 2026 (ended March 2026). Exiting the quarter, Powell’s new orders totaled $490 million, much higher than $439 million at the end of the previous quarter.

The new orders consisted of a solid volume of small, medium and large-sized awards that reflected the company’s core competencies and well-balanced portfolio across markets. It’s worth noting that in the second quarter, the company secured a data center and an electric utility order, each with about $75 million of value. Also, it booked another mega data center order with a value of more than $400 million.

In the fiscal second quarter, revenues from the electric utility sector increased 14% year over year, while those from the commercial & other industrial sector surged 35%. A strong pipeline of projects and its growing presence across the data center and electric utility sectors are expected to drive its performance in the quarters ahead.

Segment Snapshot of POWL’s PeersEnerSys (ENS - Free Report) is benefiting from the expansion of U.S. communications networks, fueled by AI-driven data demand. Increased demand for products from industrial customers is driving the Energy Systems segment’s results. Revenues from EnerSys’ Energy Systems segment increased 2.6% to $399.5 million in third-quarter fiscal 2026 (ended Dec. 31, 2025).

Franklin Electric Co. (FELE - Free Report) is benefiting from strength in the Energy Systems segment. Net sales from Franklin Electric’s Energy Systems segment totaled $71.8 million in first-quarter 2026, an increase of 7% year over year. The segmental results were driven by an increase in volumes and price realization.

POWL’s Price Performance, Valuation and EstimatesShares of Powell have surged 46.4% in the past three months compared with the industry’s growth of 1.6%.

Image Source: Zacks Investment Research

From a valuation standpoint, POWL is trading at a forward price-to-earnings ratio of 42.10X, above the industry’s average of 23.67X. Powell carries a Value Score of F.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for POWL’s fiscal 2026 (ending September 2026) earnings has increased 2.8% over the past 60 days.

Image Source: Zacks Investment Research

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Key Takeaways Powell invested about $11M to expand its Houston product factory and manufacturing capacity.POWL plans to complete a $12.4M Jacintoport expansion project by fiscal 2026-end.POWL's Houston investments support backlog execution and growth in the electric utility market. Powell Industries, Inc. (POWL - Free Report) remains focused on strengthening its growth pipeline through investments in lucrative projects and manufacturing facilities.

The company’s facility expansion project at the product factory in Houston augmented its manufacturing footprint and added significant capacity to serve growing orders. POWL spent approximately $11 million on the expansion project. This has been allowing Powell to meet strong demands in several sectors like data centers, hydrogen, carbon capture and other transitional energy markets. The expansionary efforts, which were completed in third-quarter fiscal 2025, are also playing a critical role in commercializing new products through organic investment in R&D.

Also, in August 2025, Powell announced an investment of $12.4 million to expand its production capacity at the Jacintoport fabrication yard facility in Houston. The company is on track to complete the Jacintoport expansionary project by the end of fiscal 2026 (ending September 2026). This announcement brings the cumulative investment across Powell’s three Houston manufacturing facilities to approximately $40 million over the past few years.

These investments will allow the company to boost its operational capacities, execute its current backlog and provide better services to its customers, thereby supporting its long-term growth.

Lucrative Projects of POWL’s PeersEnerSys (ENS - Free Report) has been making significant investments to expand the Thin Plate Pure Lead (TPPL) manufacturing capability. EnerSys announced its decision to shut down its lead-acid battery manufacturing plant in Tijuana, Mexico. The company will work on transitioning the majority of the production to its existing TPPL plant, based in Springfield, MO. This will help EnerSys to scale its TPPL platform, optimize its U.S. manufacturing footprint and better serve its data center customers.

Eaton Corporation plc (ETN - Free Report) has also been making multiple investments for a while to boost growth. Since 2023, the company has invested more than $1 billion in manufacturing facilities for electrical solutions across North America. Eaton remains committed to increasing the production of electrical assemblies as well as power distribution and electric grid infrastructure solutions.

POWL’s Price Performance, Valuation and EstimatesShares of Powell have gained 7.1% in the past month against the industry’s decline of 4.6%.

Image Source: Zacks Investment Research

From a valuation standpoint, POWL is trading at a forward price-to-earnings ratio of 43.91X, above the industry’s average of 23.45X. Powell carries a Value Score of F.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for POWL’s fiscal 2026 (ending September 2026) earnings has increased 2.8% over the past 60 days.

Image Source: Zacks Investment Research

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Key Takeaways Powell's backlog and utility market strength continue driving orders and revenue growth.EnerSys benefits from aerospace, defense and AI-driven communications demand growth.ENS trades at a lower forward P/E than POWL, with stronger earnings estimate revisions. Powell Industries, Inc.  (POWL - Free Report) and EnerSys (ENS - Free Report) are both prominent names operating in the electrical components and equipment sector. As rivals, these companies are engaged in providing highly engineered electrical equipment and energy storage solutions in the United States and internationally.

While Powell has been enjoying growth opportunities in electric utility and industrial markets, EnerSys is benefiting from growing needs for eco-friendly energy storage solutions across transportation, aerospace and defense markets. But which one has the better upside potential? Let’s take a closer look at their fundamentals, growth prospects and challenges to make an informed choice.

The Case for PowellPowell’s results in second-quarter fiscal 2026 (ended March 2026) indicated strong year-over-year growth, with revenues growing 6% to $297 million. The results were driven by persistent strength and healthy levels of project activity across the electric utility and commercial & other industrial markets. Growing investments across power generation and electrical distribution markets have been driving demand for its products in the electric utility market.

Several positive trends across the oil and gas market, including growth in energy transition projects, such as biofuels, sustainable aviation fuel, carbon capture and hydrogen production, are likely to be favorable for the company. Although currently subdued, the company expects the petrochemical market to recover from a gradual increase in commercial activity in the quarters ahead.

Its increased participation across the electrical power value chain has enabled it to generate solid bookings from the electric utility and commercial & other industrial markets. This has led to a strong backlog level, which was $1.8 billion (up 33% year over year and 12% sequentially) while exiting the second-quarter fiscal 2026. Exiting the fiscal second quarter, new orders totaled $490 million, higher than $249 million in the previous fiscal year quarter.

POWL’s solid liquidity position with no debt also supports its shareholder-friendly activities. Exiting the fiscal second quarter, Powell had cash equivalents and short-term investments of $544.9 million compared with $475.5 million at the end of fiscal 2025.

Despite the positives, the company has been grappling with high operating costs and expenses. In the first six months of fiscal 2026, its cost of sales rose 3% year over year, while selling, general and administrative expenses increased 17.9%. In the fiscal second quarter, the company’s gross profit margin contracted 30 basis points (bps) to 29.6%, while the operating margin declined 170 bps to 19.4%.

The Case for EnerSysEnerSys has been witnessing strength in its Specialty segment, driven by solid momentum in the aerospace and defense end markets. The segment’s revenues increased 8.1% year over year in the fourth quarter of fiscal 2026 (ended March 2026). The Energy Systems segment is benefiting from the expansion of U.S. communications networks, fueled by AI-driven data demand. Increased demand for products from industrial customers also bodes well. The segment’s revenues increased 7% in the fiscal fourth quarter.

The global megatrends, including 5G expansion, rural broadband build-outs, modernization of energy grids, electrification, automation and decarbonization, are aiding the company. Driven by strength across its businesses, EnerSys expects net sales to be in the band of $915–$955 million for fiscal 2027 (ending March 2027), indicating 5% year-over-year increase at the midpoint.

The company is making progress in new areas, including lithium battery solutions for data centers and energy storage systems for warehouses, both of which moved into customer testing and commissioning in the fiscal fourth quarter.

EnerSys announced its decision to shut down its lead-acid battery manufacturing plant in Tijuana, Mexico. The company will work on transitioning the majority of the production to its existing Thin Plate Pure Lead (TPPL) plant, based in Springfield, MO. This will help EnerSys to scale its TPPL platform, optimize its U.S. manufacturing footprint and better serve its data center customers.

EnerSys remains committed to rewarding its shareholders through dividends and buybacks.  In fiscal 2026, it paid out dividends of $38.1 million and bought back its shares worth $370.7 million. Also, the company hiked its quarterly dividend by 9% to 26.25 cents per share in August 2025.

However, ENS has been witnessing weakness in its Motive Power segment. The slowdown is caused by deferred customer capital spending in logistics and warehousing. Also, tariff-related pressures and softer demand from smaller customers have weighed on the company’s higher-margin product mix and ordering patterns. The segment’s revenues declined 5.7% year over year in the fiscal fourth quarter.

Price PerformanceIn the past month, Powell’s shares have increased 4.2%, while EnerSys stock has gained 7%.

Image Source: Zacks Investment Research

ENS’ Valuation Attractive Than POWLPowell is trading at a forward 12-month price-to-earnings ratio of 45.32X, above its median of 18.24X over the last three years. ENS’ forward earnings multiple sits at 18.17X, higher than its median of 10.91X over the same time frame.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for POWL & ENSThe Zacks Consensus Estimate for POWL’s fiscal 2026 sales and earnings per share (EPS) implies year-over-year growth of 8.7% and 10.5%, respectively. While EPS estimates for fiscal 2026 have decreased over the past 60 days, the estimate for fiscal 2027 have increased.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for ENS’ fiscal 2027 sales and EPS implies year-over-year growth of 3.3% and 14.4%, respectively. The EPS estimates for both fiscal 2027 and fiscal 2028 have increased over the past 60 days.

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Final TakePowell and EnerSys currently have a Zacks Rank #3 (Hold) each, which makes choosing one stock a difficult task. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Powell’s strong momentum in the electric utility, commercial and other industrial markets, driven by solid order rates and robust backlog, bodes well for growth. However, POWL's strength in the markets has been dented by rising operating expenses, which might affect its margins and profitability. Also, the stock’s expensive valuation warrants a cautious approach for existing investors.

In contrast, EnerSys’ strong momentum in aerospace, defense and industrial markets, and strategic investments bode well for growth in the quarters ahead. Additionally, ENS’ upwardly revised estimates instil confidence. Given these factors, ENS seems to be a better pick for investors than POWL currently.

Investors with an interest in Manufacturing - Electronics stocks have likely encountered both Vestas Wind Systems AS (VWDRY - Free Report) and Powell Industries (POWL - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Vestas Wind Systems AS is sporting a Zacks Rank of #2 (Buy), while Powell Industries has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that VWDRY has an improving earnings outlook. But this is just one piece of the puzzle for value investors.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

VWDRY currently has a forward P/E ratio of 20.94, while POWL has a forward P/E of 52.00. We also note that VWDRY has a PEG ratio of 1.40. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. POWL currently has a PEG ratio of 3.71.

Another notable valuation metric for VWDRY is its P/B ratio of 6.16. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, POWL has a P/B of 14.61.

Based on these metrics and many more, VWDRY holds a Value grade of B, while POWL has a Value grade of F.

VWDRY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that VWDRY is likely the superior value option right now.

Powell Industries (POWL - Free Report) closed the most recent trading day at $262.43, moving -7.44% from the previous trading session. This change lagged the S&P 500's daily loss of 1.62%. Meanwhile, the Dow lost 1.87%, and the Nasdaq, a tech-heavy index, lost 1.98%.

The energy equipment company's shares have seen a decrease of 7.97% over the last month, not keeping up with the Industrial Products sector's gain of 0.72% and the S&P 500's loss of 0.03%.

Analysts and investors alike will be keeping a close eye on the performance of Powell Industries in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $1.49, marking a 12.88% rise compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $318.25 million, indicating a 11.17% growth compared to the corresponding quarter of the prior year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $5.47 per share and a revenue of $1.2 billion, signifying shifts of +10.51% and +8.73%, respectively, from the last year.

Investors should also pay attention to any latest changes in analyst estimates for Powell Industries. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.68% decrease. Powell Industries presently features a Zacks Rank of #3 (Hold).

From a valuation perspective, Powell Industries is currently exchanging hands at a Forward P/E ratio of 51.83. This expresses a premium compared to the average Forward P/E of 22.39 of its industry.

One should further note that POWL currently holds a PEG ratio of 3.7. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Manufacturing - Electronics industry currently had an average PEG ratio of 1.76 as of yesterday's close.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This industry, currently bearing a Zacks Industry Rank of 90, finds itself in the top 37% echelons of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.