Aaon (AAON) AI Stock Analysis

• Market Cap: $6.17B
• Dividend Yield: 0.54%
• Average Volume (3M): 739.52K
• Price to Earnings (P/E): 39.8
• Beta (1Y): 1.50
• Revenue Growth: 8.24%
• EPS Growth: -11.66%
• Country: US
• Employees: 4,812
• Sector: Industrials
• Sector Strength: 87
• Industry: Construction
• EPS (TTM): 0.37
• Shares Outstanding: 81,366,135
• 10 Day Avg. Volume: 982,076
• 30 Day Avg. Volume: 739,525
• PEG Ratio: 0.59
• Price to Book (P/B): 7.13
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -271.71
• Enterprise Value/Market Cap: 0.66
• Enterprise Value/Revenue: 0.84
• Enterprise Value/Gross Profit: 10.40
• Enterprise Value/Ebitda: 3.58
• 1Y Price Target: $113.50
• Price Target Upside: 55.50% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 67 Neutral
• Price Target: $85.00 ▲(16.45%Upside)

AAON's strong financial performance and strategic corporate events are key strengths, while technical analysis and valuation indicate caution. The mixed outlook from the earnings call further tempers the overall score.

Positive Factors

Market Opportunities

AAON believes it can increase its national accounts market share from a small percentage today to 15%.

Product Innovation

The new Alpha Class Extreme heat pump is highly attractive to national accounts with sustainability targets due to being the only heat pump in the market fully efficient down.

Sales Growth

BASX-branded sales growth of 375% significantly exceeded expectations, indicating strong product performance.

Negative Factors

Financial Performance

Shares closed down 16% following disappointing midterm outlooks for both gross margin and top-line growth.

Operational Challenges

R454B compressor shortages caused production to slow, impacting operations.

Technology Rollout Issues

Shares took a leg lower after the second quarter was guided down 'slightly' due to issues with a new ERP rollout.

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 systems and related services. The company's business model is centered around manufacturing and distributing customized HVAC equipment to meet the specific needs of its clients across different industries. Key revenue streams include direct sales to end-users, sales through a network of distributors, and after-market services such as maintenance and repair. Aaon's focus on energy-efficient and high-performance products allows it to command a premium pricing strategy, contributing positively to its earnings. The company also benefits from strategic partnerships with suppliers and a strong emphasis on research and development, which enable it to stay ahead of industry trends and maintain a competitive edge.

Aaon Financial Statement Overview

Summary

AAON exhibits strong revenue growth and profitability metrics with a robust balance sheet showing low leverage. However, cash flow management needs improvement with negative free cash flow in TTM.

Income Statement

AAON has demonstrated strong revenue growth with a 42.6% increase from 2021 to 2025. The company maintains solid profitability with a consistent gross profit margin around 31%, and a net profit margin improving to 12.6% in TTM. Despite a slight decline in EBIT margin to 15.6% from 18.2% in 2023, the company's margins remain strong in the industry.

Balance Sheet

AAON exhibits a stable financial position with a low debt-to-equity ratio of 0.02 in TTM, indicating minimal leverage risk. The return on equity is solid at 19.5%, reflecting efficient use of shareholders' funds. However, the equity ratio decreased to 62.7% in TTM, suggesting a slight increase in liabilities relative to assets.

Cash Flow

The company faces challenges in cash flow management, with negative free cash flow of -$164.995 million in TTM. The operating cash flow to net income ratio dropped significantly, indicating potential issues in cash conversion. Despite these challenges, the overall cash flow remains positive due to strong operating cash flow historically.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.26B	1.20B	1.17B	888.79M	534.52M	514.55M
	Gross Profit
391.23M	397.11M	399.02M	237.57M	137.83M	155.85M
	EBIT
197.26M	209.12M	227.49M	126.76M	69.25M	101.84M
	EBITDA
266.18M	272.42M	274.79M	162.59M	99.73M	120.99M
	Net Income Common Stockholders
158.84M	168.56M	177.62M	100.38M	58.76M	79.01M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
994.00K	14.00K	287.00K	5.45M	2.86M	79.03M
	Total Assets
1.30B	1.18B	941.44M	813.90M	650.18M	449.01M
	Total Debt
267.83M	170.96M	50.55M	78.25M	41.58M	202.00K
	Net Debt
266.84M	170.95M	50.26M	72.80M	38.72M	-78.82M
	Total Liabilities
484.34M	350.65M	206.21M	253.19M	184.01M	98.14M
	Stockholders Equity
815.85M	824.58M	735.22M	560.71M	466.17M	350.87M
Cash Flow		Free Cash Flow
-165.00M	-3.13M	49.40M	-14.71M	5.82M	61.01M
	Operating Cash Flow
56.14M	192.53M	158.90M	61.32M	61.18M	128.81M
	Investing Cash Flow
-224.75M	-213.07M	-109.31M	-76.21M	-158.72M	-61.27M
	Financing Cash Flow
107.82M	18.03M	-46.51M	17.36M	18.73M	-29.63M

Aaon Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 72.99
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• 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 72.99 is below the 20-day moving average (MA) of 93.89, below the 50-day MA of 90.80, and below the 200-day MA of 105.09, indicating a bearish trend. The MACD of -4.68 indicates Positive momentum. The RSI at 22.75 is Positive, neither overbought nor oversold. The STOCH value of 3.89 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	81 Outperform	$94.33B	35.19	38.45%	0.89%	11.43%	28.49%
CARR	81 Outperform	$62.14B	16.35	25.69%	1.24%	0.14%	202.13%
JCI	74 Outperform	$67.90B	27.52	14.92%	1.43%	-8.39%	51.56%
LII	74 Outperform	$19.55B	24.56	131.48%	0.84%	7.78%	30.10%
AAON	67 Neutral	$6.17B	39.85	19.85%	0.54%	8.24%	-11.66%
OC	67 Neutral	$11.81B	48.28	11.93%	1.99%	16.16%	-77.11%
Sector *	66 Neutral	$4.51B	12.22	5.40%	3.63%	4.14%	-12.01%

Aaon Corporate Events

AAON Hosts Investor Day at NASDAQ MarketSite

On June 10, 2025, AAON will host an Investor Day at NASDAQ MarketSite in New York, featuring presentations from the CEO, CFO, and other executives. The event aims to provide insights into AAON’s strategic direction, highlighting its focus on innovation, customization, and automation in the HVAC industry. The company is transitioning to a brand-based structure to enhance efficiency and better leverage its manufacturing capabilities. This reorganization is expected to improve investor understanding and drive sustainable growth, particularly in the rapidly expanding data center market.

The most recent analyst rating on (AAON) stock is a Buy with a $110.00 price target. To see the full list of analyst forecasts on Aaon stock, see the AAON Stock Forecast page.

AAON Expands Loan Agreement to Boost Flexibility

On May 29, 2025, AAON, Inc. and its subsidiaries entered into a Fifth Amendment to their existing Loan Agreement with several lenders, increasing the revolving commitment from $200 million to $500 million. This amendment, which extends the maturity date to May 27, 2030, aims to enhance the company’s financial flexibility by refinancing existing term loans and adjusting the terms of their credit facilities, potentially strengthening AAON’s market position and operational capabilities.

The most recent analyst rating on (AAON) stock is a Buy with a $110.00 price target. To see the full list of analyst forecasts on Aaon stock, see the AAON Stock Forecast page.

AAON Announces Board Expansion and Dividend Declaration

On May 13, 2025, AAON, Inc. held its Annual Meeting where stockholders elected board members, ratified Grant Thornton, LLP as the independent public accounting firm for 2025, and approved executive compensation. The company also announced an increase in its Board of Directors from eight to nine members, appointing CEO Matt J. Tobolski as a new director. Additionally, AAON declared a quarterly cash dividend of $0.10 per share, payable on June 27, 2025, to stockholders of record as of June 6, 2025.

The most recent analyst rating on (AAON) stock is a Buy with a $110.00 price target. To see the full list of analyst forecasts on Aaon stock, see the AAON Stock Forecast page.

AAON Reports Strong Q1 2025 Results Amid Challenges

On April 30, 2025, AAON, Inc. announced its first quarter results for 2025, highlighting a strong performance with a 22.9% increase in net sales compared to the previous year. The company reported significant growth in its BASX-branded products, with net sales up 374.8% year-over-year, driven by demand for data center equipment. However, AAON-branded products faced challenges due to supply chain issues with R454B refrigerant components, resulting in a 23.0% decline in net sales for the Oklahoma segment. Despite these challenges, the company achieved a record total backlog of $1.0 billion, reflecting strong bookings for both BASX and AAON-branded equipment.

AAON Executives to Present at Sidoti Conference

On March 17, 2025, AAON announced that key executives, including CEO Gary Fields and CFO Rebecca Thompson, will present at the Sidoti Spring 2025 Small-Cap Conference on March 20, 2025. The presentation, which will be held virtually, is expected to provide insights into AAON’s strategic direction and market positioning, potentially impacting stakeholders’ perception of the company’s future performance.