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Investing.com - JPMorgan upgraded Argan (NYSE:AGX) from Neutral to Overweight on Monday, while raising its price target to $315.00 from $220.00. The stock has already demonstrated strong momentum, delivering an impressive 88% return year-to-date, with revenue growth of 29% in the latest reporting period.
The firm placed Argan on Positive Catalyst Watch ahead of the company’s fiscal third-quarter earnings report scheduled for December 3, citing the company as an "underappreciated beneficiary" of accelerating AI-driven power demand. According to InvestingPro data, the company maintains excellent financial health with a "GREAT" overall score, suggesting strong positioning for growth opportunities.
JPMorgan highlighted Argan’s record backlog and robust pipeline of large-scale gas projects in the U.S., noting these factors provide strong visibility into multi-year growth and margin expansion potential for the company.
The investment bank expects a series of positive catalysts ahead as new awards are booked, with backlog potentially moving "significantly over $2 billion by year-end" as management signals greater clarity on upcoming project milestones.
JPMorgan emphasized Argan’s strong balance sheet, disciplined capital returns, and track record of execution position the company to capture the "next leg of the AI infrastructure buildout" amid what it described as a "generational shift in US power demand."
In other recent news, Argan Inc. reported impressive Q2 FY2026 earnings, with an earnings per share (EPS) of $2.50, significantly surpassing the forecasted $1.64. Despite this positive earnings surprise, the company’s revenues came in at $237.7 million, slightly below the expected $243.97 million. Additionally, Argan announced a 33% increase in its quarterly cash dividend, raising it from $0.375 to $0.50 per share, marking the third consecutive annual dividend increase. This new dividend rate translates to $2.00 per share on an annual basis.
In analyst news, GLJ Research initiated coverage on Argan with a Hold rating and a $251 price target, suggesting a slight downside from current levels. The firm noted that investor expectations have outpaced management’s ability to scale into what is described as "generational demand" for its services. These developments reflect a mix of positive financial performance and cautious analyst perspectives.
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