Esco Technologies (ESE) AI Stock Analysis

• Market Cap: $5.15B
• Dividend Yield: 0.16%
• Average Volume (3M): 160.63K
• Price to Earnings (P/E): 44.9
• Beta (1Y): 0.94
• Revenue Growth: 10.65%
• EPS Growth: 15.22%
• Country: US
• Employees: 3,242
• Sector: Technology
• Sector Strength: 97
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 1.57
• Shares Outstanding: 25,824,688
• 10 Day Avg. Volume: 211,583
• 30 Day Avg. Volume: 160,629
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.06
• Enterprise Value/Revenue: 4.95
• Enterprise Value/Gross Profit: 12.21
• Enterprise Value/Ebitda: 26.40
• 1Y Price Target: $218.00
• Price Target Upside: 12.17% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 69 Neutral
• Price Target: $213.00 ▲(9.60% Upside)

Esco Technologies demonstrates strong financial performance and positive earnings call insights, which are the most significant factors in the overall score. However, the high P/E ratio and low dividend yield suggest valuation concerns, and the lack of technical analysis data limits a comprehensive market trend assessment.

Positive Factors

Acquisition Impact

The acquisition of Maritime Solutions has been integrated into the fiscal year guidance, enhancing the company’s exposure to global Naval expansion and power transmission trends.

Financial Performance

ESE beat expectations for the second quarter and increased its guidance for the full fiscal year, driven by improved margins in Aerospace & Defense and USG.

Negative Factors

Boeing Strikes Concern

The Aerospace & Defense segment showed strong performance, with Navy sales increasing by 56% year-over-year, offsetting concerns about the Boeing strikes.

Market Pressure

The RF segment is potentially turning a corner, supported by strong free cash flow generation.

Esco Technologies Business Overview & Revenue Model

Company Description

ESCO Technologies Inc. produces and supplies engineered products and systems for industrial and commercial markets worldwide. It operates through Aerospace & Defense, Utility Solutions Group, and RF Shielding and Test segments. The Aerospace & Defense segment designs and manufactures filtration products, including hydraulic filter elements and fluid control devices used in commercial aerospace applications; filter mechanisms used in micro-propulsion devices for satellites; and custom designed filters for manned aircraft and submarines. It also designs, develops, and manufactures elastomeric-based signature reduction solutions for U.S. naval vessels; and mission-critical bushings, pins, sleeves, and precision-tolerance machined components for landing gear, rotor heads, engine mounts, flight controls, and actuation systems for the aerospace and defense industries. The Utility Solutions Group segment provides diagnostic testing solutions that enable electric power grid operators to assess the integrity of high-voltage power delivery equipment; and decision support tools for the renewable energy industry, primarily wind and solar. The RF Shielding and Test segment designs and manufactures RF test and secure communication facilities, acoustic test enclosures, RF and magnetically shielded rooms, RF measurement systems, and broadcast and recording studios; and RF absorptive materials and filters, active compensation systems, antennas, antenna masts, turntables, electric and magnetic probes, RF test cells, proprietary measurement software, and other test accessories to perform various tests. It also provides services, such as calibration for antennas and field probes, chamber certification, field surveys, customer training, and various product tests. The company distributes its products through a network of distributors, sales representatives, direct sales teams, and in-house sales personnel. The company was incorporated in 1990 and is based in St. Louis, Missouri.

How the Company Makes Money

Esco Technologies generates revenue through the sale of its high-tech products and services across various sectors. Key revenue streams include the sale of test and measurement equipment, which is utilized by clients in aerospace and telecommunications industries for product testing and validation. Additionally, the company earns income from its environmental testing solutions that allow clients to ensure compliance with regulatory standards. Utility metering solutions also contribute significantly to its earnings, as they are essential for modern energy management. Esco maintains strategic partnerships with major players in the aerospace and energy sectors, enhancing its market reach and providing access to larger contracts. The company's commitment to research and development ensures a continuous pipeline of innovative products, further solidifying its revenue generation capabilities.

Esco Technologies Financial Statement Overview

Summary

Esco Technologies demonstrates strong financial health with consistent revenue growth, robust profitability, and solid cash flow generation. The balance sheet is stable with low leverage, supporting financial stability. Minor fluctuations in EBIT margins are noted but do not significantly detract from overall performance.

Income Statement

Esco Technologies shows strong and consistent revenue growth, with TTM revenue increasing by 4.4% from the previous year. The company maintains healthy profitability with a gross profit margin of 40.2% and a net profit margin of 11.0% in the TTM period. Although EBIT margin decreased slightly from the previous year, EBITDA margin improved, reflecting operational efficiency. The overall profitability and growth trajectory are robust, with slight fluctuations in EBIT.

Balance Sheet

The balance sheet reflects a solid financial position with a favorable debt-to-equity ratio of 0.10, indicating low leverage and financial stability. The return on equity (ROE) is strong at 9.2%, showcasing effective use of equity to generate profit. The equity ratio stands at 70.3%, highlighting a strong reliance on equity financing. Esco Technologies demonstrates balance sheet strength, though continued monitoring of debt levels is prudent.

Cash Flow

Cash flow analysis reveals a positive trend in free cash flow growth with a substantial increase of 37.0% in the TTM period. The operating cash flow to net income ratio is above 1, indicating efficient cash generation relative to net income. However, free cash flow to net income ratio suggests room for further improvements. The company's cash flow generation is solid, supporting its growth strategy.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.11B	1.03B	956.03M	857.50M	715.44M	732.91M
Gross Profit	449.32M	404.02M	375.66M	332.05M	270.39M	272.16M
EBITDA	207.78M	200.54M	178.24M	159.63M	124.97M	84.47M
Net Income	114.83M	101.88M	92.55M	82.32M	63.50M	99.41M
Balance Sheet
Total Assets	2.53B	1.84B	1.68B	1.65B	1.58B	1.37B
Cash, Cash Equivalents and Short-Term Investments	78.72M	65.96M	41.87M	97.72M	56.23M	52.56M
Total Debt	568.63M	179.83M	163.53M	177.85M	216.10M	114.43M
Total Liabilities	1.20B	601.27M	552.07M	606.30M	557.65M	411.93M
Stockholders Equity	1.33B	1.24B	1.13B	1.05B	1.02B	961.60M
Cash Flow
Free Cash Flow	121.43M	91.38M	42.12M	90.26M	87.65M	41.15M
Operating Cash Flow	160.39M	127.54M	76.89M	135.28M	123.14M	82.28M
Investing Cash Flow	-524.95M	-104.64M	-52.47M	-55.92M	-202.44M	140.95M
Financing Cash Flow	334.52M	-773.00K	-78.33M	-32.12M	81.47M	-236.22M

Esco Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 194.35
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESE, the sentiment is Positive. The current price of 194.35 is above the 20-day moving average (MA) of 192.90, above the 50-day MA of 189.96, and above the 200-day MA of 160.49, indicating a bullish trend. The MACD of 1.42 indicates Negative momentum. The RSI at 53.46 is Neutral, neither overbought nor oversold. The STOCH value of 85.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ESE.

Esco Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LFUS	80 Outperform	$6.33B	53.20	4.74%	1.06%	1.34%	-38.02%
SANM	80 Outperform	$6.60B	25.76	11.58%	―	5.87%	20.66%
MKSI	75 Outperform	$6.95B	26.29	11.12%	0.84%	4.47%	2887.37%
PLXS	74 Outperform	$3.59B	23.10	12.12%	―	2.31%	48.63%
OSIS	72 Outperform	$3.91B	28.36	16.73%	―	14.93%	12.89%
ESE	69 Neutral	$5.15B	44.95	9.01%	0.16%	10.65%	15.22%
Sector *	61 Neutral	$36.32B	7.12	-7.26%	1.97%	7.79%	-9.36%

Esco Technologies Corporate Events

ESCO Technologies Reports Strong Q3 2025 Results

On August 7, 2025, ESCO Technologies reported its fiscal 2025 third-quarter results, highlighting a 27% increase in sales to $296 million and a 25% rise in adjusted EPS from continuing operations to $1.60. The company completed the sale of VACCO Industries, marking its exit from the space business, and integrated ESCO Maritime Solutions, significantly boosting its Navy business. This strategic shift resulted in a record backlog of $1.17 billion and a book-to-bill ratio of 2.53x, positioning ESCO for continued above-market growth. The company raised its full-year FY 2025 guidance, expecting adjusted EPS growth of 21%-24% over the previous year.

The most recent analyst rating on (ESE) stock is a Hold with a $161.00 price target. To see the full list of analyst forecasts on Esco Technologies stock, see the ESE Stock Forecast page.