Aaon (AAON) AI Stock Analysis

• Market Cap: $6.31B
• Dividend Yield: 0.46%
• Average Volume (3M): 1.26M
• Price to Earnings (P/E): 41.4
• Beta (1Y): 1.55
• Revenue Growth: 8.24%
• EPS Growth: -11.66%
• Country: US
• Employees: 4,812
• Sector: Industrials
• Sector Strength: 94
• Industry: Construction
• EPS (TTM): 0.37
• Shares Outstanding: 81,366,135
• 10 Day Avg. Volume: 1,503,184
• 30 Day Avg. Volume: 1,255,215
• PEG Ratio: -6.87
• Price to Book (P/B): 7.75
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -38.27
• Enterprise Value/Market Cap: 1.04
• Enterprise Value/Revenue: 4.53
• Enterprise Value/Gross Profit: 63.07
• Enterprise Value/Ebitda: 19.29
• 1Y Price Target: $107.33
• Price Target Upside: 38.38% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 68 Neutral
• Price Target: $85.00 ▲(9.59%Upside)

AAON's overall stock score is mainly driven by strong financial performance and positive corporate events, which enhance strategic positioning. However, technical indicators and valuation suggest caution due to potential overvaluation and bearish trends. Mixed earnings call results highlight both growth opportunities and operational challenges.

Positive Factors

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

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 shows robust financial performance with strong revenue growth and solid profitability metrics. The balance sheet reflects low leverage, enhancing financial stability, though there are challenges in cash flow management with negative free cash flow. Overall, the company is well-positioned within the construction industry, but improvements in cash flow management are needed.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.20B	1.17B	888.79M	534.52M	514.55M
Gross Profit	397.11M	399.02M	237.57M	137.83M	155.85M
EBITDA	272.42M	274.79M	162.59M	99.73M	120.99M
Net Income	168.56M	177.62M	100.38M	58.76M	79.01M
Balance Sheet
Total Assets	1.18B	941.44M	813.90M	650.18M	449.01M
Cash, Cash Equivalents and Short-Term Investments	14.00K	287.00K	5.45M	2.86M	79.03M
Total Debt	170.96M	50.55M	78.25M	41.58M	202.00K
Total Liabilities	350.65M	206.21M	253.19M	184.01M	98.14M
Stockholders Equity	824.58M	735.22M	560.71M	466.17M	350.87M
Cash Flow
Free Cash Flow	-3.13M	49.40M	-14.71M	5.82M	61.01M
Operating Cash Flow	192.53M	158.90M	61.32M	61.18M	128.81M
Investing Cash Flow	-213.07M	-109.31M	-76.21M	-158.72M	-61.27M
Financing Cash Flow	18.03M	-46.51M	17.36M	18.73M	-29.63M

Aaon Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 77.56
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AAON, the sentiment is Positive. The current price of 77.56 is above the 20-day moving average (MA) of 75.82, below the 50-day MA of 84.35, and below the 200-day MA of 102.03, indicating a neutral trend. The MACD of -1.03 indicates Negative momentum. The RSI at 49.14 is Neutral, neither overbought nor oversold. The STOCH value of 58.27 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AAON.

Aaon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TT	81 Outperform	$102.97B	38.22	38.45%	0.77%	11.43%	28.49%
CARR	77 Outperform	$68.10B	18.27	25.69%	1.09%	0.14%	202.13%
LII	74 Outperform	$23.34B	28.25	112.94%	0.71%	7.92%	29.72%
OC	74 Outperform	$12.28B	52.52	11.93%	1.85%	16.16%	-77.11%
JCI	73 Outperform	$72.40B	29.37	14.92%	1.35%	-8.39%	51.56%
AAON	68 Neutral	$6.31B	41.37	19.85%	0.46%	8.24%	-11.66%
Sector *	65 Neutral	$11.06B	15.73	5.16%	1.93%	3.12%	-25.59%

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.