Aaon (AAON) AI Stock Analysis

• Market Cap: $6.84B
• Dividend Yield: 0.53%
• Average Volume (3M): 910.40K
• Price to Earnings (P/E): 57.8
• Beta (1Y): 1.46
• Revenue Growth: 8.77%
• EPS Growth: -47.50%
• Country: US
• Employees: 4,812
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 0.39
• Shares Outstanding: 81,499,855
• 10 Day Avg. Volume: 985,391
• 30 Day Avg. Volume: 910,398
• PEG Ratio: -1.59
• Price to Book (P/B): 6.95
• Price to Sales (P/S): 4.31
• P/FCF Ratio: -32.48
• Enterprise Value/Market Cap: 1.04
• Enterprise Value/Revenue: 4.92
• Enterprise Value/Gross Profit: 18.38
• Enterprise Value/Ebitda: 31.41
• 1Y Price Target: $121.33
• Price Target Upside: 44.61% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): 1.99
• Revenue Forecast (FY): $1.56B

• Rating: 58 Neutral
• Price Target: $96.00 ▲(14.42% Upside)
• Action: Reiterated Date: 03/06/26
• Date: Action: Reiterated 03/06/26

The score is held back primarily by the sharp 2025 cash flow deterioration and margin pressure, despite strong multi-year growth and an otherwise solid balance-sheet history. Guidance and backlog signal a potential 2026 rebound, but valuation is demanding and technicals are neutral, keeping the overall outlook moderate.

Positive Factors

Large, growing backlog and Basics demand

A >2x book-to-bill and a $1.3B backlog provide durable revenue visibility across multi-phase data center and commercial programs. This sustained demand supports multi-quarter production planning, justifies capacity investment, and underpins revenue/margin recovery as throughput improves.

Historically conservative balance sheet

A historically conservative balance-sheet and equity growth provide financial flexibility to fund capex and working capital during ramps. This resilience lowers default and refinancing risk, enabling the company to execute capacity expansion and backlog conversion over the medium term.

Capacity expansion with clear 2026 guidance

Material footprint expansion plus explicit 2026 targets signal management confidence that higher utilization will lift incremental margins. If execution matches guidance, the added capacity and clearer operating plan should sustainably increase throughput and improve long-term margin structure.

Negative Factors

Sharp deterioration in operating cash flow

A collapse in operating cash flow and steep negative free cash flow indicates weaker earnings quality and heightened working-capital or investment demands. Persisting cash conversion issues would strain liquidity, raise funding costs, and limit the firm's ability to self-fund capex or absorb shocks.

Extremely low year-end cash and elevated debt

Very low cash balances combined with meaningful debt and near-term higher interest expense reduce the firm's liquidity buffer. This structural tightness raises refinancing and interest-rate risk, making execution of capacity ramps and backlog conversion more contingent on access to credit and working-capital management.

Operational disruptions and ERP/plant ramp frictions

ERP rollout problems, plant shutdowns and under-absorbed fixed costs create structural execution risk: they lengthen lead times, depress margins, and can delay backlog conversion. Repeated operational frictions could persistently impair margin recovery despite strong demand.

Aaon Business Overview & Revenue Model

Company Description

AAON, Inc., together with its subsidiaries, engages in engineering, manufacturing, marketing, and selling air conditioning and heating equipment in the United States and Canada. The company operates through three segments: AAON Oklahoma, AAON Coil Products, and BasX. It offers rooftop units, data center cooling solutions, cleanroom systems, chillers, packaged outdoor mechanical rooms, air handling units, makeup air units, energy recovery units, condensing units, geothermal/water-source heat pumps, coils, and controls. The company markets and sells its products to retail, manufacturing, educational, lodging, supermarket, data centers, medical and pharmaceutical, and other commercial industries. It sells its products through a network of independent manufacturer representative organizations and internal sales force. The company was incorporated in 1987 and is based in Tulsa, Oklahoma.

How the Company Makes Money

Aaon generates revenue primarily through the sale of its HVAC equipment, which includes chillers, rooftop units, and air handlers. The company has a diverse customer base that includes contractors, wholesalers, and property owners in various sectors such as healthcare, education, and manufacturing. Key revenue streams are derived from direct sales, as well as aftermarket services, which include maintenance and replacement parts. Additionally, partnerships with contractors and distributors enhance market reach and facilitate project-based sales. The company's focus on energy-efficient products aligns with growing regulatory demands and customer preferences for sustainable solutions, further bolstering its earnings potential.

Aaon Financial Statement Overview

Summary

Multi-year revenue growth and a historically conservative balance sheet support the profile, but 2025 showed clear deterioration in quality of earnings: operating cash flow fell to near zero and free cash flow turned deeply negative, alongside margin compression. This cash conversion setback is the primary financial risk despite prior-year strength.

Income Statement

Revenue expanded meaningfully from 2021–2024 (including a breakout year in 2022 and continued gains in 2023), and 2025 continued to grow at a solid pace. Profitability was strong in 2022–2024 (healthy gross and net margins), but 2025 saw a notable step-down in both operating profitability and net margin versus the prior two years, suggesting recent margin pressure. Net income remains positive, but the trajectory over the last year is weaker than the earlier run-rate.

Balance Sheet

The balance sheet is conservatively positioned: debt levels were modest historically and are reported at zero in 2025, resulting in very low financial leverage. Equity has grown strongly over time, and returns on equity were attractive in 2022–2024, though they cooled in 2025 alongside the earnings decline. Overall, the company appears financially flexible with limited balance-sheet risk.

Cash Flow

Cash generation deteriorated sharply in 2025: operating cash flow collapsed to near-zero while free cash flow turned deeply negative, which is a major red flag versus the consistently positive operating cash flow in prior years. Even in 2024, free cash flow was slightly negative despite strong profits, pointing to working-capital or investment demands. The large negative free cash flow relative to net income in 2025 indicates earnings quality concerns and higher near-term funding/volatility risk if the trend persists.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.44B	1.20B	1.17B	888.79M	534.52M
Gross Profit	385.72M	397.11M	399.02M	237.57M	137.83M
EBITDA	225.84M	272.42M	274.79M	162.59M	99.73M
Net Income	107.59M	168.56M	177.62M	100.38M	58.76M
Balance Sheet
Total Assets	1.69B	1.18B	941.44M	813.90M	650.18M
Cash, Cash Equivalents and Short-Term Investments	13.00K	14.00K	287.00K	5.45M	2.86M
Total Debt	433.38M	170.96M	50.55M	78.25M	41.58M
Total Liabilities	791.52M	350.65M	206.21M	253.19M	184.01M
Stockholders Equity	894.99M	824.58M	735.22M	560.71M	466.17M
Cash Flow
Free Cash Flow	-191.42M	-3.13M	54.60M	7.29M	5.82M
Operating Cash Flow	-861.00K	192.53M	158.90M	61.32M	61.18M
Investing Cash Flow	-192.42M	-213.07M	-109.31M	-76.21M	-158.72M
Financing Cash Flow	188.00M	18.03M	-46.51M	17.36M	18.73M

Aaon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 83.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AAON, the sentiment is Negative. The current price of 83.9 is below the 20-day moving average (MA) of 96.54, below the 50-day MA of 92.83, and below the 200-day MA of 87.95, indicating a bearish trend. The MACD of -2.04 indicates Positive momentum. The RSI at 33.65 is Neutral, neither overbought nor oversold. The STOCH value of 11.89 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AAON.

Aaon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TT	78 Outperform	$93.49B	29.82	36.17%	0.95%	8.58%	20.37%
CSL	77 Outperform	$13.96B	18.48	36.69%	1.28%	0.14%	3.88%
JCI	70 Outperform	$79.67B	36.04	23.52%	1.27%	-10.19%	100.65%
CARR	69 Neutral	$46.49B	29.70	10.50%	1.65%	-7.93%	-35.00%
LII	67 Neutral	$16.74B	29.73	78.89%	0.96%	3.77%	12.46%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
AAON	58 Neutral	$6.84B	57.78	12.63%	0.53%	8.77%	-47.50%

Aaon Corporate Events

AAON Declares Regular Quarterly Cash Dividend for Shareholders

On March 5, 2026, AAON, Inc. announced that its board of directors declared the company’s next regular quarterly cash dividend of $0.10 per share, equivalent to $0.40 on an annualized basis. The dividend is scheduled to be paid on March 30, 2026, to shareholders of record at the close of business on March 18, 2026, underscoring AAON’s continued capital return to investors and signaling confidence in its ongoing financial performance.

The declared dividend maintains AAON’s pattern of regular quarterly distributions, which can be an important consideration for income-focused investors following the HVAC sector. By affirming its payout level, the company reinforces its shareholder-friendly stance while operating in a competitive market for high-efficiency, custom HVAC systems serving commercial, industrial and data center customers.

The most recent analyst rating on (AAON) stock is a Buy with a $117.00 price target. To see the full list of analyst forecasts on Aaon stock, see the AAON Stock Forecast page.

AAON Reports Record 2025 Results and Share Repurchase Plan

On March 2, 2026, AAON reported record full-year 2025 results, with net sales up 20.1% to $1.44 billion but lower gross margins and EPS as the company absorbed costs tied to major capacity expansions and an ERP implementation. The company ended 2025 with a record $1.83 billion backlog, highlighted by a 141.3% surge in BASX-branded orders for data center equipment, underscoring strong demand and market-share gains despite extended lead times.

Fourth-quarter 2025 sales rose 42.5% year over year to $424.2 million, with BASX-branded revenue up 138.8% and AAON-branded revenue up 9.5%, while margins were pressured by fixed-cost under-absorption during the Memphis ramp-up. AAON also announced that its board authorized up to $100 million in open-market share repurchases and introduced a 2026 outlook calling for high-teens revenue growth and margin expansion, signaling confidence that recent investments will translate into improved profitability.

Management highlighted that production at the new Memphis facility reached profitability earlier than expected, and that ERP-related disruptions at the Longview, Texas plant have largely eased, positioning operations for better efficiency in 2026. The combination of record backlog, expanding manufacturing footprint, and disciplined capital deployment through buybacks is set to strengthen AAON’s competitive position in the HVAC and data center cooling markets while offering potential upside for shareholders.

The most recent analyst rating on (AAON) stock is a Buy with a $120.00 price target. To see the full list of analyst forecasts on Aaon stock, see the AAON Stock Forecast page.

AAON Expands Revolving Credit Facility to $600 Million

On December 29, 2025, AAON, Inc. activated the accordion feature on its existing revolving credit facility, expanding its available borrowing capacity to $600 million to bolster financial flexibility amid strong fourth-quarter bookings and robust market-driven customer demand. The increased facility is intended to strengthen the company’s ability to fund working capital, capital expenditures and strategic projects, supporting its ongoing growth initiatives while maintaining a disciplined capital structure and reinforcing its positioning in the HVAC market.

The most recent analyst rating on (AAON) stock is a Hold with a $88.00 price target. To see the full list of analyst forecasts on Aaon stock, see the AAON Stock Forecast page.