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Investing.com - Maxim Group resumed coverage on Graham Corporation (NYSE:GHM) with a Buy rating and a price target of $65.00 on Wednesday. The stock has shown remarkable momentum, delivering a 72.41% return over the past year according to InvestingPro data, though current valuations suggest the stock may be trading above its Fair Value.
The research firm cited expected growth in energy production, military defense spending, and space travel as key drivers that will increase demand for Graham’s equipment. Graham operates facilities across multiple states including Colorado, New York, and Florida, positioning it to receive equipment design requests from industrial customers across various industries. The company’s strong financial health score of GREAT on InvestingPro, along with its solid balance sheet showing more cash than debt, supports its expansion potential.
For fiscal year 2026 ending in March, Graham Corporation has provided revenue guidance of $225 million to $235 million, representing 7% to 12% year-over-year growth. The company also forecasts EBITDA of $22 million to $28 million, ranging from a 2% decrease to a 25% increase year-over-year.
Maxim’s revenue projection of $241 million for FY26 exceeds the company’s guidance, while its EBITDA estimate of $26 million falls within the guided range. The firm expressed confidence in new CEO Matt Malone, noting he "fits well with GHM’s current strategic vision."
Graham Corporation had a net cash balance of $21.6 million as of March 31, 2025, which Maxim believes will support potential acquisitions and manufacturing capacity expansions. The $65 price target represents 20.6 times Maxim’s fiscal year 2027 EBITDA forecast.
In other recent news, Graham Corporation reported impressive financial results for the third quarter of fiscal year 2025, significantly exceeding analysts’ expectations. The company announced an earnings per share (EPS) of $0.43, almost double the forecasted $0.22, and achieved revenue of $59.3 million, surpassing the anticipated $55.83 million. This strong performance was driven by growth in the defense sector and strategic initiatives, with the company projecting continued growth and setting its fiscal 2026 revenue guidance between $225 million and $235 million. Additionally, Graham Corporation has been awarded a $136.5 million contract to provide mission-critical equipment for the U.S. Navy’s Virginia class submarine program, enhancing its stable revenue stream. In terms of analyst activity, the company’s stock has not been recently upgraded or downgraded, but Graham’s strategic investments and strong market positioning have been acknowledged. The company also announced a leadership transition, with Matt Malone set to become President and CEO, succeeding Dan Thorin. These developments underscore Graham Corporation’s strategic focus and operational execution in key markets.
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